3 Years, Nearly 100 Million Credit Cards Canceled! Banks Continue Adjusting This Business

Over the past three years, China’s credit card industry has significantly “shrunk.”

Recently, the People’s Bank of China released the overall operation status of the payment system in Q3 2025, showing that since 2025, the number of credit cards (including credit and debit cards combined) has reached 707 million. According to a review by Securities China reporters, the nationwide credit card volume has continued its previous downward trend this year, decreasing by 20 million from the beginning of the year; over a longer period, nearly 100 million credit cards have been reduced in the past three years.

Based on data from several listed banks’ credit card businesses this year, three main trends continue: first, the number of issued cards has sharply contracted, with credit card business shifting from scale expansion to quality optimization; second, the growth rate of credit card consumption has significantly slowed, indicating a certain market contraction; third, the asset quality of credit card loans at most large and medium-sized banks has fluctuated notably, while efforts to clear bad debts have accelerated.

Nearly 100 million credit cards “disappeared” in three years

On December 2, the People’s Bank of China disclosed in the “Overall Operation of the Payment System in Q3 2025” that by the end of September 2025, the number of credit cards had decreased to 707 million. Compared with previous data, the number of credit cards has declined for 12 consecutive quarters from the peak of 807 million at the end of September 2022, a reduction of about 100 million cards.

Credit card business is a key part of banks’ retail strategies and an important source of intermediary and interest income. In recent years, financial regulators have significantly strengthened supervision and regulation of bank credit card operations, so the number of cards issued, customer base, market share, or market ranking are no longer primary or sole performance indicators for banks.

In recent years, leading banks in card issuance have also accelerated the cleanup of “sleeping” credit cards, which is a response to regulatory requirements for dynamic monitoring and management of long-term dormant cards. The regulatory definition of long-term dormant cards refers to those with no active transactions for over 18 months, with current overdraft balances and no surplus payments. After gradually disposing of these dormant cards, the active card rate has improved.

According to a review of credit card data disclosed by several listed banks over the past two years, by the end of the first half of 2025, major state-owned banks such as Bank of Communications, Industrial and Commercial Bank of China, China Construction Bank, and Postal Savings Bank saw their credit card issuance decrease year-on-year, with reductions of approximately 4.79 million, 4 million, 2 million, and 1 million cards respectively. Conversely, banks like CITIC Bank, Bank of China, Huaxia Bank, and China Merchants Bank experienced counter-trend growth, with CITIC Bank increasing about 6.37 million cards year-on-year, and Bank of China and Huaxia Bank growing by 2.34 million and 1.8 million respectively.

Senior credit card researcher Dong Zheng believes that the contraction of the credit card market results from a combination of regulatory policies, market competition, changes in user habits, and banks’ strategic adjustments. For example, from a competitive perspective, the evolution of the payment ecosystem and competing products have impacted credit cards. Mobile payments have deeply integrated into daily life, relying on payment scenarios that seamlessly embed internet credit payment tools, significantly replacing traditional credit cards in small, high-frequency transactions.

63 credit card centers shut down this year

The accelerated integration and cleanup of credit card businesses are also reflected in the contraction and closure of some commercial banks’ dedicated credit card branches.

According to data from the Financial Regulatory Administration’s official website, as of the time of reporting, a total of 63 credit card centers at banks such as Bank of Communications, Minsheng Bank, and China Guangfa Bank have ceased operations this year.

Specifically, Bank of Communications closed the most, with 56 centers, including those in Shanghai, Beijing, Shenzhen, and Guangzhou, which were shut down sequentially within the year. Minsheng Bank also closed five centers—North China, Northeast, Central China, South China, and Deyang. Guangfa Bank terminated operations at the Changji and Mudanjiang centers.

In fact, credit card centers established by banks are usually managed directly by the head office, with costs for staffing, marketing, and venue operations independent of local branches. These dedicated branches flourished during the rapid expansion phase of credit card business (“land grabbing”), investing resources to develop markets in cities with gaps.

As the credit card market has entered a highly competitive “red ocean” in recent years, coupled with strengthened regulatory oversight, more banks are considering the return on investment and choosing to “manage carefully” and optimize credit card operations.

In March 2025, during the annual performance briefing, the management of Bank of Communications first responded to the nationwide “wave of mergers and closures” of credit card centers, emphasizing the “accelerated transformation of credit card local operations.”

The bank’s management stated that the previous model of centralized direct management of credit card centers had played a unique role during the rapid growth phase. However, as the business enters a new stage, the limitations of this model have become increasingly apparent.

In response to market changes, Bank of Communications officials said that to better meet customer needs for integrated financial services and to adapt to the new development stage of credit card business, the bank has reformed its operational model—from centralized management to local branch operations. Local branches now provide one-stop, comprehensive financial services to local customers, integrating credit card business into retail operations in their regions.

Closing credit card centers does not mean service withdrawal but rather a strategic shift. Industry insiders previously told Securities China that after transferring customers from the original centers to local branches, banks can continue to offer services through a combined “online + offline” approach, embedding credit card services into wealth management and consumer loans to enhance customer loyalty.

Retail assets like credit card loans under pressure

Besides the sluggish growth in card volume, another major trend this year is the decline in total transaction amounts from credit card consumption, with some banks even seeing year-on-year decreases in outstanding credit card loan balances.

Looking at the total consumption amount in the first half of 2025, data from five comparable listed banks show a year-on-year decline. Specifically, China Merchants Bank’s credit card consumption was 2.02 trillion yuan, down about 188.8 billion yuan from the same period in 2024. Other banks like Everbright Bank, CITIC Bank, Industrial Bank, and Huaxia Bank saw decreases of 169.3 billion, 155.7 billion, 111 billion, and 70 billion yuan respectively.

Another indicator is the overdraft (loan) balance on credit cards. Comparing the top 10 banks by credit card overdraft balances, in the first half of 2025, most state-owned banks like Agricultural Bank of China and ICBC saw increases, but many joint-stock banks experienced declines. For example, Ping An Bank, CITIC Bank, Minsheng Bank, and Everbright Bank saw their credit card overdraft balances decrease by approximately 76.1 billion, 45.6 billion, 25.1 billion, and 15.4 billion yuan respectively.

Deloitte, a consulting firm, analyzed in a September report that the decline in credit card consumption in the first half of 2025 is influenced by macroeconomic conditions and consumer confidence. The overall decrease in credit card spending reflects weakened household consumption demand and increased precautionary savings. Overall, the credit card consumption market is shrinking, and banks face challenges of declining transaction volumes.

Additionally, Securities China review shows that many leading state-owned and joint-stock banks experienced a year-on-year rise in non-performing credit card ratios in the first half of 2025, indicating asset quality pressures.

Specifically, non-performing rates at ICBC, Minsheng Bank, and Industrial Bank have exceeded 3%, with Bank of Communications approaching that level. ICBC’s non-performing rate rose 0.72 percentage points to 3.75%, Bank of Communications increased 0.65 points to 2.97%, and China Construction Bank and Minsheng Bank rose by 0.49 and 0.44 points to 2.35% and 3.68% respectively. Meanwhile, banks like Industrial Bank and Ping An Bank have seen notable reductions in non-performing rates, decreasing by 0.6 and 0.4 percentage points.

The Wang Jian team at Guoxin Securities also pointed out in a November report that retail loan risks are now surfacing, with no clear peak yet. Personal housing loans, consumer loans, and credit card loans are all showing signs of risk exposure. Over recent years, the non-performing rate of credit card loans has continued to rise, though the rate of increase has slowed.

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