SBI Cards & Payment Services conducted a conference call on 27 October 2023 to discuss its financial results for the quarter ended September 2023. Abhijit Chakravorty, MD&CEO addressed the call:

Highlights:

The digital economy is a playing major role in the economy with 58% jump in the digital payments. The government expects the share of digital payments to increase to 20% of GDP by FY2026.

The credit card outstanding has increased by 30% to Rs 2.18 lakh crore and September 2023

The credit cards base has increased to 93 million end August 2023. The credit card spends has touched an all time high of Rs 1.48 lakh crore in August 2023.

The company has added 5.3 lakh cards on net basis, while the total new accounts addition was at 11.4 lakh. The company has witnessed reduction in the attrition in the customers over a year ago, but rose on sequential basis due to KYC related issues.

The overall cards base of the company has increased 21% to 1.79 crore end September 2023.

The market share in cards stands at 19.2% end September 2023.

The cards spends of the company has increased 27% to Rs 79000 crore in Q2FY2024. The company has also exhibited an improvement in the spends per card to Rs 1.8 lakh from Rs 1.71 lakh.

The retail card spends has increased 21% to Rs 61446 crore in Q2FY2024. The corporate spends also increased 55% to Rs 17718 crore.

The company has partnership with all major cards networks.

POS sales as well as online sales has exhibited strong across categories.

Outstanding per credit card has remained steady at Rs 25000.

The cost of fund was stable at 7.1%, while the margins have eased marginally by 10 BPS in Q2.

The credit cost was lower at 6.7% on account of the actions taken at portfolio level and better collection efficiency.

The company expects cost of funds to be slightly higher for next two quarters.

Rupay card account for 10% of the card portfolio and the company is the market leader in the Rupay credit cards.

The company expects credit cost to remain elevated in Q3FY2024. The credit cost is expected to remain above 6%.

The revolver balance stands steady at 24 - 25% for last 4-5 quarters.

Regulator has been guiding the lenders take care of the risk management in the unsecured loan segments.