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RBI’s Proposed Credit Card Risk Weights and SBI Cards’ Capital Gain

13 October 20251 min read
BANKING & FINANCERBI’s ProposedCredit Card RiskWeights and SBICards’ Capital Gain13 October 2025safalsetu.com

Why in the news

RBI proposed revised risk weights for credit card issuers. Analysts examined what this means for SBI Cards & Payment Services.

Key facts

  • Today every ₹100 of card dues carries a 125% risk weight, so capital needed is ₹18.75 (15% CRAR on ₹125).
  • Proposal: transactor dues at 75%; revolver dues stay at 125%.
  • Transactor: paid in full by due date over the last 12 months.

Effect on SBI Cards

  • Transactors hold 40% of outstanding dues (Q1 FY26).
  • Blended weight: 75% on ₹40 plus 125% on ₹60 gives 105%.
  • Minimum capital need drops from ₹18.75 to ₹15.75.

Other financial points

  • Share price up 40% in 2025, but CAGR since IPO is below 5%.
  • Gross credit cost rose from 6.7% (Q2 FY24) to 9.6% (Q1 FY26); net cost from 5.5% to 8.5%.
  • CRAR rose from 20.6% to 23.2%, well above the 15% minimum, so capital is no growth constraint.

Exam angle

  • Transactor vs revolver: 75% vs 125%.

Test yourself

1. Under RBI's proposal, what risk weight applies to credit card dues of transactors?

Transactor dues are reduced to a 75% risk weight.

2. For SBI Cards, the blended risk weight under RBI's proposal falls from 125% to what figure?

75% on ₹40 plus 125% on ₹60 gives 105%.

3. In the notes, who counts as a 'transactor' for RBI's credit card risk weights?

Transactors paid fully and on time in the last 12 months.