According to the latest statistics, the credit card business of China’s listed state-owned major banks and commercial banks is experiencing a comprehensive decline. Key indicators such as credit card loan balances, transaction volumes, and the number of circulating cards have all shown decreases, with a rise in credit card delinquency rates reflecting the profound impact of the economic downturn on the credit card industry.
The statistics for the mid-year performance of 2025 compiled by “First Financial” show that in the first half of 2025, the total credit card loan balance of 14 listed banks (including 6 major state-owned banks and 8 commercial banks) decreased by 1975.72 billion yuan compared to the beginning of the year, down 2.56% year-on-year to 7.52 trillion yuan.
Among them, China Construction Bank saw the largest decrease in credit card loan balance, amounting to 5224.99 billion yuan, a decrease of 13.88% from the beginning of the year; Ping An Bank and Industrial Bank saw decreases of 9.23% and 8.07%, respectively.
Out of the 14 banks, only ICBC, Agricultural Bank of China, and Shanghai Pudong Development Bank saw a slight increase in their credit card loan balances. China Construction Bank topped the list with a balance of 1.05 trillion yuan, albeit a slight 1.03% decrease from the beginning of the year.
Not only has the credit card loan balance, which reflects the level of credit card activity, decreased, but credit card transaction volume has also significantly declined. In the first half of the year, the total amount of credit card transactions for 12 banks that disclosed data amounted to 11.47 trillion yuan, a decrease of 11.05% year-on-year, which is a reduction of 1.42 trillion yuan. China Construction Bank and Agricultural Bank of China saw smaller declines, at around 5%, while Bank of China and China Everbright Bank’s transaction volumes dropped by over 18%, and China Merchants Bank was the only one to surpass 2 trillion yuan in transaction volume, reaching 2.02 trillion yuan but still experiencing an 8.54% decrease year-on-year.
Revenue from credit card businesses has generally decreased, with China Merchants Bank seeing a 4.96% year-on-year decline in credit card interest income to 30.612 billion yuan and a 16.23% decrease in non-interest income to 10.471 billion yuan.
For Central Bank data showed that credit card balances overdue for more than half a year surged from 33.77 billion yuan in 2008 to 1239.64 billion yuan by the end of 2024, nearly 36 times in sixteen years, with a 26.32% increase in 2024 alone, accounting for 1.43% of outstanding credit balances.
In the first quarter of 2025, the average discount rate for bulk transfer of non-performing loans dropped to 4.1%, with a principal recovery rate of only 6.9%.
The Bank of China announced today that starting from September 14, collection costs will be included in overdue bills, indicating increased difficulty in recovery.
A distressed asset operator told “First Financial,” “The cost of prosecution is getting higher, while recovery continues to shrink, putting pressure on the traditional outsourced collection model.”
Chen Xinjian, Vice Chairman of the Bank of China, stated that the new occurrence of credit card delinquency in the first half of the year decreased by 7.5% year-on-year. However, the overall delinquency rate is still rising, with Bank of Communications seeing a 0.63 percentage point increase in delinquency rate by the end of the first half of the year compared to the beginning. The credit card delinquency rates of China Merchants Bank are at 1.75%, and for Postal Savings Bank and Agricultural Bank of China, they are around 1.5%.
In terms of the number of credit cards, both banks and individuals have been canceling cards that hold no value.
Many users on social media platforms expressed that the benefits of current credit cards are not as good as before, leading them to cancel redundant credit cards and only retain 1-2 high-benefit cards. One user said, “I used to have 7 credit cards, but this year, I canceled the extra ones and kept only one from China Merchants Bank.”
As per the joint notice issued by the former CBIRC and the Central Bank, most banks have regulations that limit the total number of credit cards in good standing held by a single customer to no more than 6. Dong Ximiao, Chief Researcher of Galaxy Securities, stated that various banks have also conducted a cleanup targeting “long-term dormant” credit cards with no active transactions for more than 18 months and zero outstanding balances.
As of the end of June 2025, among the 14 banks, the total number of circulating credit cards for the 10 banks that disclosed data was 890 million, a decrease of 3.91 million year-on-year. Ping An Bank saw the most significant reduction, with a net decrease of 6.26 million over the year, a decrease of 12%; ICBC and Bank of Communications each saw a reduction of about 4 million over the year, while China CITIC Bank and China Everbright Bank saw increases of 6.37 million and 3.3 million, respectively.
In 2024, the overall situation of the national payment system shows a decrease of 40 million combined credit and debit cards, a decrease of 5.14%. In the first half of 2025, there was an additional decrease of 12 million, with the per capita card volume dropping from 0.54 to 0.52 cards.
Additionally, starting from August 31, 2025, the Bank of China has stopped offering 24 co-branded cards, while China CITIC Bank has terminated some UnionPay co-branded card businesses, followed by actions from Shanghai Pudong Development Bank, Postal Savings Bank, and others.
In addition to the suspension of co-branded cards, banks have been downsizing their institutions to cope with the decline in business.
According to Wind data, over 40 credit card sub-centers have been approved for closure within the year. In July, the Guangdong Financial Supervision Bureau successively approved the termination of operations for the credit card sub-centers of Bank of Communications in Zhuhai and Minsheng Bank in South China. Industrial and Commercial Bank of China had closed more than 10 sub-centers such as Jinan and Shenyang in a single month in April.
Su Xiaorui, a researcher at Suxi Research, stated, “Credit cards are facing both internal and external challenges of declining asset quality, narrowing profit margins, and the impact of internet credit payment.”
An article in the “China Securities Journal” commented that against the backdrop of the current contraction in the credit card market, the removal of regulations on the upper and lower limits of credit card overdraft interest rates may help banks respond to external changes but also implies risks of high interest rates for consumers.