A new research report by TransUnion CIBIL, Beyond the Swipe, suggests the role of credit cards within India’s broader consumer lending ecosystem is changing.
While the card market has continued to expand rapidly, consumers are using multiple credit products- from small-ticket personal loans and consumer durable finance to loan-on-card products- making competition among lenders significantly more intense.
The numbers stress how far the market has come. Between March 2016 and March 2026, the number of live credit cards in India rose from 2.1 crore to 10.7 crore, while the number of card consumers nearly quadrupled from 1.4 crore to 5.2 crore. Outstanding balances expanded even faster, rising more than eight-fold from ₹0.4 lakh crore to ₹3.1 lakh crore.
But despite this expansion, credit cards are no longer the dominant form of consumption credit they once were.
According to the report, credit cards accounted for 56% of outstanding balances across key consumption-credit products in March 2016. By March 2026, that share had fallen to 38% as borrowers diversified their credit usage across multiple unsecured lending products.
The consumer wallet itself has become considerably more complex over the past decade.
Among credit card holders, the share of consumers who also held another consumption-focused loan doubled from 16% in 2016 to 32% in 2026. At the same time, consumers holding three or more credit cards increased from 12% to 22%, reflecting a growing willingness to borrow across multiple lenders and products rather than relying on a single card issuer.
This marks an important structural shift for lenders.
Rather than relying primarily on customer acquisition, banks are competing to become the “top-of-wallet” lender—capturing a greater share of customer spending, balances and engagement within an fragmented credit ecosystem.
That trend is also reflected in borrowing behaviour. The average outstanding card balance per consumer has more than doubled over the past decade, rising from roughly ₹31,000 in March 2016 to approximately ₹65,000 in March 2026.
The report argues that future growth in India’s card business will depend on how successfully issuers deepen relationships with existing borrowers rather than simply issuing new cards.
Competition is also becoming more intense as customers hold relationships with multiple lenders. Among consumers with at least three card issuers, the preferred lender’s share of monthly balances falls to around 58%, compared with nearly 69% at the overall portfolio level, illustrating how wallet share becomes more fragmented as consumers diversify their credit relationships.
The study also finds that borrower loyalty is becoming fluid.
Between 47% and 52% of consumers across different borrower segments shifted loyalty away from their preferred card issuer over a 12-month period, with many simultaneously opening new unsecured credit products.
The report further highlights the emergence of younger borrowers as a key driver of the next phase of consumer credit growth.
Unlike previous generations, many Gen Z consumers are entering the credit card ecosystem with existing borrowing relationships already in place. At the time of first card origination, 31% already hold two or more active credit products, 23% already have a small-ticket personal loan and 18% have an active consumer durable loan.
Within a year of obtaining their first credit card, more than half of these young consumers go on to open another unsecured credit product, reinforcing the report’s finding that credit cards are functioning as one element within a broader borrowing portfolio rather than as the consumer’s first formal credit relationship.
According to TransUnion CIBIL, this evolution has important implications for lenders. As consumers build diversified credit wallets, traditional one-product growth strategies are likely to become less effective. Future growth opportunities will depend on understanding how borrowers allocate spending across multiple products and lenders while carefully managing emerging credit risks.
