Purchases using credit cards in Bangladesh displayed periodic fluctuations but overall indicated an upward trend in the months since May 2023, highlighting a growing appetite among consumers for credit. 

Credit card holders spent Tk 2,742 crore in May this year, a year-on-year increase of 15 percent from Tk 2,369 crore in the same month last year, according to a Bangladesh Bank report released yesterday.

Transactions, however, decreased 1.47 percent compared to April's Tk 2,783 crore.

Md Mahiul Islam, deputy managing director of BRAC Bank, said transactions declined slightly in recent months. "However, it will pick up."

The spending peaked at Tk 2,987 crore in March before registering a decline in the following months. Even though the expenses fell, purchases in certain categories experienced growth.

For example, transactions at departmental stores increased to Tk 1,401 crore in May from Tk 1,390 crore in the previous month.

Similarly, there was rise in purchases at retail outlets, utilities, drugs and pharmacies, cash withdrawals, fund transfers, as well as for transportation, business, professional, and government services.

BB data showed a reduction in transactions related to clothing, marking a significant drop from the previous month. This underscores the nature of consumer behaviour and the variability across different spending categories, according to the BB report.

Md Abu Bokar Siddik, head of cards at Mutual Trust Bank PLC, said consumers spend higher amount through credit cards in Ramadan and ahead of Eid-ul-Fitr.

This year, the fasting month began in mid-March and ended in the middle of April.

"Therefore, we saw a spike in expenditures through credit cards in the two months and subsequent decline in the following months. However, transactions increased in June," he said, adding that appetite for credits is growing.

In Bangladesh, there were 24.69 lakh credit cards in use as of April this year, almost doubling from the 13.6 lakh seen five years ago.

Credit card users making purchases abroad totalled Tk 456 crore in May, showing a slide of 9.94 percent, the central bank's report said.

Similarly, transactions through credit cards issued by foreign entities but utilised in Bangladesh declined to Tk 169 crore from Tk 199 crore, a fall of 14.67 percent.