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Axis Bank card fee income rises by 30% YoY 8 months after demonetization

Axis Bank, the third largest private sector lender in India, reported a card fee income of Rs 379 crore for the quarter ended March 2017 (Q4 FY17). This was 30% year-on-year (YoY) increase from Rs 290 crore. This accounted for around 16% of the total fee income at the bank.

Note that Axis Bank has a significant card business and is the fourth largest issuer of credit and debit cards. It is also the third largest POS terminal merchant acquirer in the country. At the end of the quarter, the total number of debit cards in circulation stood at 20.2 million (growing 30% YoY) and the number of credit cards stood at 3.3 million  (with a growth of 39% YoY).

Card fee income was also buoyed by increasing spends on cards. Spends on debit and credit cards stood at Rs 17,157 crore, an 83% increase from Rs 9,356 crore from the same quarter.


It looks like Axis Bank is being able to sustain the gains on cards following the demonetization. In the December quarter (Q3 FY17), card spends by Axis Bank customers shot up to Rs 15,750 crore growing 82% from Rs 8,635 crore. As a consequence, fee from the cards business grew by 23% year-on-year in the preceding quarter.

The number of transactions at ATMs continued to fall during the quarter. ATM transactions accounted for only 21% of the total mix while digital accounted for 66%. Digital transaction volumes grew 87% during the quarter.

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However, it is worth noting that Axis Bank has been increasing the number of ATMs and stood at 14,163. With this, Axis Bank has the second largest ATM network; State Bank of India (SBI) has the largest number of ATMs with 50,368 machines.

Mobile Banking

Mobile banking transaction volume stood at 33.2 million at the end of the quarter and the spends on mobile banking were Rs 36,745 crore growing 76% YoY. Note that it is unclear what Axis Bank means by mobile banking – does mobile banking refer to apps on smartphones, USSD transaction, it’s Lime wallet application?

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