Credit card base reaches all time high

The credit card base in Sri Lanka has reached its highest ever level in July surpassing the previous record number established in 2008.

As per Central Bank data, by July this year, the credit card base amounted to 918,216, thereby overtaking the previous best of 917,418 established in 2008. Following the collapse of Golden Key and other macro economic factors, the credit card base shrank in the next two years. The lowest base was in 2010 with a figure of 778,474, down by 15% over 2008’s peak.

Industry analysts have been heartened by the recovery in the credit card market since 2011 and its continuity todate.

The outstanding balance as at July also remained an all time high of Rs. 40.4 billion, up from Rs. 37.6 billion end last year and Rs. 33.3 billion in 2008. In comparison to 2006’s figure of Rs. 21 billion, the outstanding balance has almost doubled.

From early this year, owing to upward trend in interest rates and inflation along with a slowdown in economic growth conditions, the credit card industry too has had a challenging environment.

However aggressive marketing and value offerings by the major players have sparked growth and greater spend.  The growth in number of merchants has also helped the issuers and customers.

Industry analysts expect the credit card market to remain buoyant with interest rate scenario forecast to dip in the near term and upcoming festive season giving an extra impetus though.