SBI Cards & Payment Services Ltd Management Discussions

Management Discussion and Analysis Report

GLOBAL ECONOMY

Against the geopolitical backdrop, the global economy recorded GDP growth of 3.4% in 2025, with growth trends varying across regions. Advanced economies expanded by 1.9%, supported by 2.1% growth in the United States, while the Euro area and Japan recorded growth of 1.4% and 1.2%, respectively. Emerging markets continued to outperform, registering overall growth of 4.4%, led by Indias 7.6% expansion and Chinas 5.0% growth.

The global economy is expected to maintain stable growth momentum; with world GDP projected at 3.1% in 2026 and 3.2% in 2027. Advanced economies are projected to record growth of 1.8% in 2026, led by the United States with estimated growth of 2.3%, supported by fiscal measures, improving market conditions and recovery in economic activity. The Euro area is expected to maintain stable growth of 1.1%, while Japans growth is projected at 0.7% following recent policy adjustments.

Global headline inflation is projected to rise to 4.4% in 2026, before moderating to 3.7% in 2027 amid continuing geopolitical developments and supply-side pressures. Central banks across major economies are expected to continue calibrated policy measures, including gradual rate adjustments to support growth while managing inflationary trends. Meanwhile, global trade growth is projected to moderate to 2.6% in 2026, although technology-led exports are expected to continue supporting trade activity.

(Source: World Economic Outlook (IMF), WEO- April (IMF))

INDIAN ECONOMY

The Indian economy demonstrated resilient growth during FY 2025-26 despite global trade uncertainties and market volatility. As per the Second Advance Estimates published in February 2026, real GDP growth stood at 7.6%, while Gross Value Added (GVA) expanded by 7.7%, supported by strong domestic demand and broad-based economic activity.

FRE = First Revised Estimate; SAE = Second Advance Estimates;

P = Projections

(Source: PIB (SAE), PIB (FAE), MoSPI)

India continued to remain one of the worlds fastest-growing major economies, supported by resilient domestic demand, strong investment activity and ongoing structural reforms. The country is expected to sustain its growth momentum and improve its global standing over the medium term as economic expansion continues.

Private consumption remained a key driver of growth during the year, supported by moderating inflation and rising real incomes, which strengthened household purchasing power. The Union Budget 2026-27 proposed capital expenditure of Rs.12.2 lakh crore towards infrastructure development, providing impetus to sectors such as manufacturing, construction and energy. Government initiatives, including the Viksit Bharat 2047 vision, continued to support self-reliance and long-term capacity creation amid evolving global challenges.

GST rationalisation measures supported consumption activity during the year, as reflected in the improvement of several high-frequency economic indicators, including higher e-way bill generation, record festive-season automobile sales, robust growth in UPI transaction values and increased consumer spending across key sectors.

Average headline Consumer Price Index (CPI) Inflation reached a historic low of 2.07% during FY 2025-26. This price stability has been a key driver in strengthening domestic purchasing power. Moving forward, due to the global distress, the government has finalised the inflation rate at 3.4% (as of March 2026). This stability is supported by fiscal discipline and steady growth in bank credit. Furthermore, the banking sector remains resilient with strong capital reserves and low levels of bad loans.

Indias foreign exchange reserves remained robust at approximately USD 682.35 billion (as of week ended July 24, 2026). However, they moderated from earlier-year peaks amid foreign exchange market interventions and volatility in global energy markets. Separately, India continued to strengthen its position among the worlds largest economies, supported by sustained domestic economic growth and expanding economic activity.

(Source: PIB, PIB 2, Economic Times, MoSPI, Economic Times)

RBI Policy

The Reserve Bank of India continued its monetary easing trajectory through FY 2025, implementing four successive rate cuts totaling 125 basis points (bps) to support growth amid durable disinflation gains. Starting from February 2025 with a 25 bps reduction to 6.25%, followed by another 25 bps cut in April 2025 to 6.00% alongside a shift to an accommodative stance, the policy repo rate reached 5.50% after a 50 bps cut in June 2025. The December 2025 Monetary Policy Committee (MPC) meeting delivered the final 25 bps trim to 5.25% while lowering CPI inflation projection to 2.1% and raising FY 2025-26 GDP growth forecast to 7.3%. February and April 2026 saw MPC holding the repo rate unchanged at 5.25%, prioritising credit flow and investment amid a neutral outlook. The central bank revised the FY 2025-26 real GDP projection to 7.4% in February 2026.

To support systemic liquidity and maintain orderly financial market conditions, the Reserve Bank of India continued to deploy targeted liquidity management measures, including open market operations and foreign exchange buy/sell swap auctions. These measures were directed towards easing short-term funding pressures, supporting financial market stability, and ensuring adequate rupee liquidity amid evolving global uncertainties.

The banking sector witnessed healthy credit expansion during FY 2025-26, with bank credit growing by 16.08%, outpacing deposit growth of 13.47%, according to RBI data.

(Source: Economic Times, Business World)

Future Outlook

The outlook for the Indian economy remains positive and stable, with real GDP growth projected between 6.8%-7.2% for FY 2026-27. Sustained government infrastructure expenditure, alongside steadily rising private sector investments, will anchor this expansion, complemented by a strengthening manufacturing foundation. The services sector anticipates continued consistent performance, reinforcing structural economic resilience.

Reinforced by macroeconomic stability and consistent policy frameworks, India stands well-positioned to navigate external challenges. This approach ensures inclusive and sustainable long-term economic progress across diverse societal segments.

(Source: PIB)

At the same time, the escalating conflict in West Asia has emerged as a key external risk for India. As a major importer of crude oil and natural gas, India remains exposed to disruptions in global energy supply chains and shipping routes. Higher crude oil prices could increase import costs, exert pressure on the current account balance and contribute to imported inflation. Prolonged volatility in energy markets has also placed pressure on the Rupee and increased fiscal and monetary policy challenges. While Indias foreign exchange reserves and macroeconomic fundamentals provide an important buffer against external shocks, the geopolitical situation and any potential resolution remain key factors influencing the nearterm economic outlook.

Despite external uncertainties, Indias medium-term growth outlook remains favourable, supported by strong domestic demand, sustained public capital expenditure, increasing manufacturing activity, expanding digital infrastructure and continued formalisation of the economy. Rising private investment, improving financial inclusion and ongoing policy initiatives aimed at strengthening infrastructure, logistics and ease of doing business are expected to support economic activity across sectors. Nevertheless, the trajectory of energy prices, geopolitical developments and global trade conditions will remain important determinants of growth and inflation going forward.

INDUSTRY OVERVIEW

Indias Digital Economy

Indias digital payments ecosystem continued to witness strong growth during FY 2025-26. Supported by increasing smartphone penetration, expanding internet access, rising financial inclusion, the rapid adoption of digital payment solutions, government initiatives, technological advancements, and changing consumer preferences, digital payments have become an integral part of the countrys financial ecosystem across urban and semi-urban markets.

The Indian digital payment market was valued at approximately USD 6.75 billion in 2025 and is projected to reach USD 52.10 billion by 2034, growing at a CAGR of 22.27% during the forecast period. The growth is being supported by increasing adoption of UPI, digital wallets, cloud-based payment infrastructure, and expanding merchant acceptance networks across the country.

The Governments Digital India programme and the Jan Dhan- Aadhaar-Mobile framework have continued to strengthen financial inclusion and expand access to formal payment systems. Government-led initiatives promoting merchant digitisation and digital payment adoption have further accelerated the transition towards cashless transactions across both urban and rural markets.

UPI remained the primary driver of digital payment growth during the year. According to the International Monetary Fund, UPI emerged as the worlds largest real-time retail payment system in the year 2025, processing more than 640 million transactions per day. The platform continued to witness strong growth, with total transaction volume increasing by 30% to over 24,161 crore transactions and transaction value rising by 21% to 314 lakh crore during the year 2026. March 2026 recorded a historic high of 2,264 crore transactions valued at nearly 29.5 lakh crore, highlighting the growing scale of digital payment adoption across the country.

The expansion of payment acceptance infrastructure further supported this growth. During 2025, UPI merchant acceptance expanded, supported by approximately 678 million QR codes and over 11 million Point-of-Sale (PoS) terminals deployed across the country. The increasing availability of digital payment infrastructure has enabled wider adoption among small merchants, local businesses, and MSMEs.

The continued growth of e-commerce, quick commerce, and app-based transactions has also contributed to rising digital payment volumes. Retail and e-commerce remained the largest end-use segment, accounting for nearly 35% of industry revenue during the year 2025. Increasing digitisation of consumer spending and greater integration of payment solutions across digital platforms continued to support transaction growth.

At the same time, the RBI and NPCI continued to strengthen the ecosystem through initiatives focussed on payment innovation, interoperability, security and customer convenience. The introduction of enhanced UPI functionalities, AI-enabled payment solutions, biometric authentication and cross-border payment capabilities has contributed to a more secure, efficient and inclusive payments infrastructure.

The long-term outlook for Indias digital payments industry remains favourable, supported by rising digital adoption, expanding merchant acceptance, increasing formalisation of the economy and continued innovation across payment platforms. These trends are expected to support sustained growth in digital transactions and deeper penetration of digital financial services across the country.

(Source: IMARC, https://www.imarcgroup.com/india-digital-payment- market)

INDIAN CREDIT CARD SECTOR

The Indian credit card industry continued to witness steady growth during 2025, supported by increasing adoption of digital payment instruments, expanding access to formal credit and rising consumer spending across categories. Growth in e-commerce, digital services, organised retail and app-based transactions continued to support higher credit card usage, while increasing financial inclusion and deeper penetration of banking services contributed to the expansion of the customer base.

The Indian credit card market was valued at USD 20.1 billion in 2025 and is projected to reach USD 39.5 billion by 2034, registering a CAGR of 7.49% during 2026-34. The growth of the sector is being supported by rising adoption of digital payments, increasing availability of credit products and growing penetration of financial services across emerging consumer segments.

The industry demonstrated continued resilience and structural growth during FY 2025-26, supported by rising consumer aspirations, increasing digital adoption and expanding acceptance infrastructure. Based on RBI data, the industry achieved the following milestones:

• Card issuance: The total number of credit cards in circulation reached a record 11.9 crore by the end of March 2026. The industry maintained healthy momentum in customer acquisition, with more than 9 lakh new cards added during quarter ending, March 2026

• Credit card spending: Consumer spending remained strong during the year, supported by festive demand and increasing digital commerce adoption. Total spending during FY 202526 reached Rs.23.62 lakh crore, representing a 12% year-on- year increase, while March 2026 alone contributed Rs.2.19 lakh crore. E-commerce continued to outpace PoS growth and accounted for the majority share of retail spending

• Acceptance infrastructure: The acquiring ecosystem continued to expand, supported by regulatory initiatives and growing adoption of digital payment acceptance solutions. The number of PoS terminals exceeded 1.18 crore during the year, complemented by an expanding network of Bharat QR acceptance points

The industry also witnessed important structural developments that are expected to influence future growth:

• UPl-credit integration: The linkage of RuPay credit cards with the UPI ecosystem continued to gain momentum during FY 2025-26 and emerged as an important industry growth driver. The integration has expanded credit card usage across micro-merchant (P2M) transactions and enabled consumers to use credit cards for smaller-value everyday purchases, including groceries and utility payments. This has supported wider credit adoption, particularly across Tier-2 and Tier-3 markets where traditional PoS infrastructure remains relatively limited

• Evolving regulatory framework: FY 2025-26 witnessed the implementation of enhanced RBI regulations focussed on consumer protection and customer-centricity. Measures relating to enhanced billing transparency, faster grievance redressal, mandatory tokenisation for recurring payments, and Alternate Factor Authentication have strengthened industry standards. While these measures increased compliance requirements, they have contributed to higher consumer confidence and improved payment security across the ecosystem

The long-term outlook for the Indian credit card industry remains favourable, supported by increasing formalisation of the economy, rising digital payment adoption, expansion of financial services across Tier II and Tier III markets, and growing participation from younger consumer segments. Continued development of digital payment infrastructure, increasing adoption of co-branded products, and deeper integration of credit cards within digital commerce ecosystems are expected to support sustained growth across the sector.

OPPORTUNITIES AND THREATS

Opportunities

The Indian credit card industry continues to offer significant long-term growth potential. The industry reached a milestone of 11.9 crore cards by March 2026. However, overall penetration remains low relative to the broader population. A study done as of March 2023, noted that, India had approximately seven credit cards per 100 people, compared with 201 in Brazil, 57 in China, 67 in Australia, 84 in the UK, 241 in South Korea, and 343 in the USA. This highlights the substantial opportunity for further expansion as credit adoption and digital payment usage continue to increase. Industry estimates project the Indian credit card market to grow from USD 20.1 billion in 2025 to approximately USD 35.9 billion by 2034, reflecting a CAGR of 7.49%.

The industrys future growth is expected to be supported by the following opportunities:

• Geographic expansion across emerging markets:

Customer acquisition is increasingly shifting beyond metropolitan centres towards Tier 2, Tier 3, and Tier 4 markets. Improved digital onboarding capabilities, wider distribution reach, and growing consumer aspirations in these markets are supporting credit card adoption. As of early 2026, average spending per card across Public Sector Banks increased by 20% year-on-year, reflecting rising card utilisation among customers in non-metro locations

• Expansion of UPI-credit integration: The integration of RuPay credit cards with the UPI ecosystem has expanded the acceptance of credit-based payments across a broader merchant base, including micro-merchants. This enables issuers to participate in high-frequency, low-value transactions while enhancing customer engagement and everyday card usage

• Growth in digital commerce and recurring payments:

Digital commerce continues to be a key driver of credit card usage, with online transactions accounting for over 62.5% of total credit card transactions as of March 2026. The continued growth of e-commerce and quick commerce, together with the increasing digitisation of recurring payments such as insurance premiums, educational fees, and tax payments, presents opportunities to capture a larger share of consumer spending

Threats

The Indian credit card industry continues to operate in an evolving regulatory, technological, and competitive environment. Changes in customer preferences, rapid digital innovation, and increasing competition require issuers to continuously adapt their business models, strengthen risk management practices, and enhance customer value propositions

• Evolving fintech ecosystem: The rapid expansion of the fintech ecosystem across lending, payments, WealthTech, InsurTech, neobanking and emerging technology platforms is reshaping the competitive landscape. The increasing use of alternative data, digital-first customer journeys and innovative credit solutions may intensify competition for customer acquisition and engagement

• Intensifying competition from new issuers: The market is witnessing heightened competition from both established and new issuers seeking to expand their customer base. Competitive pricing strategies, lifetime-free card offerings, attractive rewards programmes and co-branded partnerships may increase customer acquisition costs and place pressure on portfolio growth and retention strategies

Risks and Concerns

In the current operating environment, the Company is exposed to a multi-dimensional and evolving risk landscape, encompassing credit, liquidity, market, operational, fraud, technology, model, regulatory and data privacy risks, against the backdrop of tightening regulation, accelerated digital adoption, and macroeconomic uncertainty.

During FY 2025-26, the credit environment remained volatile, particularly within unsecured lending, with the credit card portfolio exhibiting elevated stress indicators and signs of customer over leverage. External macroeconomic factors including global growth concerns and ongoing geopolitical tensions have had an impact on portfolio performance.

In response, the Company has adopted a proactive and agile risk management approach, implementing calibrated interventions across the credit lifecycle, including tighter underwriting standards, dynamic limit management, refined customer segmentation, and enhanced early warning and collection strategies. The Company also monitors concentration risks across customer segments, geographies, and merchant categories to avoid excessive exposure to specific risk pockets. This is complemented by continuous alignment of policies and processes with evolving regulatory expectations.

The Company also actively manages liquidity and funding risks, with a focus on maintaining adequate liquidity buffers, diversified funding sources, and prudent asset-liability management to mitigate the impact of interest rate volatility and market disruptions. Capital adequacy is closely monitored, supported by internal stress testing and scenario analysis frameworks to ensure sufficient resilience under adverse economic conditions.

Given the increasing reliance on data-driven decision-making, the Company recognises model risk, particularly in credit underwriting, fraud detection, and Expected Credit Loss (ECL) estimation and has strengthened model validation, governance, and periodic review frameworks.

The Company also has a robust third-party risk management framework. It continues to invest in system resilience, scalability, and business continuity capabilities. The Company remains vigilant to fraud risks, including first- party delinquencies, digital onboarding fraud, identity theft, phishing, and account takeover incidents and has strengthened detection and prevention frameworks through advanced analytics and real-time monitoring. Given the rapidly evolving threat landscape, including a rising incidence of cyber attacks, data breaches, and financial frauds, the Company continues to prioritise information security and cyber resilience.

Overall, the Company remains committed to strengthening its enterprise risk management framework, with enhanced risk governance, cross-functional oversight, stress testing and early warning systems, ensuring resilience across economic cycles while supporting sustainable and profitable growth.

BUSINESS OVERVIEW

Card Acquisition

The Company continued to expand its credit card portfolio in FY 2025-26 with its active card base reaching 2.21 crore as of March 2026, compared to 2.08 crore cards in March 2025, representing a 6.1% year-on-year growth. Leveraging both the open market and banca channels, the Company sourced approximately 36 lakh cards during the year, with focus on acquiring profitable customer segments. The Company maintained a strategic focus on premium card sourcing, with higher emphasis on high fee variant cards through targeted campaigns and deeper penetration within the parent banks premium segment customer base. The Company sourced 50% of overall new accounts through the Banca channel leveraging the distribution network of SBI. The Company will continue to leverage this extensive network to tap into newer markets and newer segments. The Company is also leveraging SBIs YONO platforms and digital capabilities to drive targeted campaigns and seamless preferred segment sourcing. Targeted Card on YONO, further strengthened our digital-first product suite and reinforcing our commitment to seamless, value- driven customer experiences. Close collaboration with SBI subsidiaries, ensured unified efforts and maximised reach.

The Company has also strengthened its digital acquisition with the launch of new co-branded cards in partnership with large digital industry players. The increased digital acquisition also contributed to sustained reductions in acquisition costs, thereby enhancing overall operational efficiency.

New Product Launches

• Tata Neu SBI Card: A flagship, rewards led co-branded proposition powering the Tata Neu ecosystem at scale. The card delivers accelerated Neu Coins across the Tata Neu app, website, and partner Tata brands, creating a seamless, high engagement digital commerce experience across one of Indias largest consumer ecosystems

• Apollo Select SBI Card: A differentiated health and wellness focussed card anchored on the Apollo ecosystem. It offers accelerated rewards on Apollo Pharmacy spends, complimentary Apollo memberships, and curated healthcare privileges positioning SBI Card as a leader in the rapidly growing digital health and wellness segment

• Flipkart SBI Card: A high scale e-commerce credit card designed to maximise value for Indias largest online shopping base. The card delivers accelerated rewards and platform led discounts on Flipkart, enabling strong acquisition and spends, particularly during marquee sale events

• PhonePe SBI Card: A true digital first credit card built for high frequency, everyday digital spends. Integrated deeply with the PhonePe platform, it rewards utility payments, recharges, and daily transactions, driving scale and stickiness among Indias fastest growing digital payment users

• IndiGo SBI Card: A premium travel focussed card designed for frequent flyers, leveraging IndiGos market leading aviation footprint. The card offers complimentary flight tickets, reduced convenience fees, and accelerated rewards on indigo bookings, delivering strong value across travel and lifestyle spends

• Bank of Maharashtra SBI Card: A co-created banking partnership card developed to scale customer acquisition and engagement within the Bank of Maharashtra ecosystem. It offers a balanced rewards proposition across dining, groceries, and utilities, combined with seamless banking integration and wide customer reach

Spends and Engagement in FY 2025-26

• The Company has maintained its robust growth momentum in spends. Retail spends for FY 2025-26 were at Rs.353,764 crore, demonstrating a YoY growth of ~15%

• The Company has maintained its meaningful presence in Corporate Card Business; Corporate spends for FY 2025-26 were at Rs.76,595 crore, demonstrating a YoY growth of 210% YoY

• The Company continued with its strong merchant partnership presence - both at national and regional levels, delivering 1,800+ offers during the year. Apart from key merchant partnerships during the festive season, the Company launched EMI-focussed campaigns with prominent brands in the consumer durables and smartphone industry such as Apple, LG, Samsung, Oppo, Vivo, Sony and others. The Company expanded its regional partnership footprint in Tier 2/3/4 cities this year, launching ~400 offers with merchants across spend categories including prominent brands viz. Aditya Vision, Big C, Value Plus & others

• The Company has continued to leverage on growing significance of online purchases, as 62% of spending during the year was made online

Brand

• The Company continues to be the most recognised brand in the credit card category, with the highest Top-of-Mind Awareness and 100% Total Awareness, as per the Brand Track survey commissioned by the organisation and conducted by Kantar IMRB in January-March 2026

• The Company ensured consistent brand visibility throughout FY 2025-26 with multiple campaigns. A targeted advertising campaign across South markets was executed to promote Simplyclick SBI Card and SBI Card Pulse, also strengthening brand visibility & regional presence. Strategic airport OOH at Mumbai T2 and in-cinema advertising across premium screens in Mumbai, Bengaluru, and Delhi were deployed to promote AURUM. SBI Card Elite was promoted through high- impact OOH site targeting HNIs and affluent professionals, strategically located at the prime intersection of corporate towers in DLF Cyber City, Gurugram. To capitalise on the national excitement following Indias Womens Cricket World Cup victory, the Company executed a high-visibility jacket print ad with Sportstar. Pulse Card was promoted in Bengaluru using outdoor transit mediums to target young working professionals & fitness enthusiasts. An integrated campaign was launched to promote our festive special offers under the umbrella branding of ‘Khushiyan Unlimited

• Brand salience was further augmented through Companys ongoing Retail Kiosks Program. Over 170 kiosks at strategic customer touchpoints like airports, malls, metro stations, and corporate parks ensured brand presence at the POS while also enhancing customer acquisition efforts. SBI Card continued harnessing the power of PR for varied aspects and initiatives, including new products and partnerships, to further bolster brand reputation

Digital Platforms

Mobile App:

• The Companys mobile app can be downloaded both on Play Store and App Store with app ratings at 4.6/5.0 on Play Store and 4.5/5.0 on App Store in FY 2025-26. It has recorded 1.5 crore active app installations and continues to be a preferred self-service digital channel for its customers. The app has over 100 features for self-servicing, crosssell, and customer engagement on the platform and has recorded over 81.8 crore+ logins in FY 2025-26

• In FY 2025-26, the Company launched numerous features and functionality updates to simplify servicing, enhance customer experience, increase engagement, and drive transactions. Some of the key implementations include-enablement of view eCard, integration of new hyper personalisation platform, enhancement of E-Store for travel booking and gifting, e-KYC integration for KYC renewal, address change and contact change processes, unification of credit limit across all SBI Cards to allow spends with ease

Website:

• The Companys website continues to be highly visited by customers and prospects with over 21.9 crore visits in FY 2025-26. The website channel provides multiple features that enable self-servicing, engagement, and cross-sell along with credit card catalogue and eApply journeys for digital applications

• In FY 2025-26. the Company redesigned its website to deliver a seamless & intuitive customer experience. With mobile-first approach, the revamped website offers easy browsing on mobile devices, and a more simplified card selection journey for the users

WhatsApp:

• The WhatsApp Connect service works as an additional selfservice channel to SBI Cardholders. During FY 2025-26, about 31.4 lakh unique customers accessed the platform and 79.09 lakh customers opted in for the service. The channel is used for features such as viewing account summary, transactions history, monthly statement downloads, availing credit limit increase offers, enabling Overlimit switch, activating card, pay utility bills, converting transactions into Flexipay EMIs, hot listing the card and many other features

• To increase usage of the platform and to enhance customer engagement, several features have been added during the financial year, vis.-Introduction of transaction decline nudges and switch activation to complete transaction, preapproved credit limit increase offer journey, transaction decline nudges for credit limit exhausted with nudge to increase limit, etc.

Ask ILA:

• The Companys chatbot Ask ILA seamlessly integrates with its mobile app and the website. It has been an important self-service channel with approx. 2 crore total logins during FY 2025-26. The platform has addressed ~6 crore customer queries during the year. Several new features were added to Ask ILA in the last financial year to enhance customer experience and engagement. Some of the key features include - Interactive Statements, Live Chat capabilities enhancements, etc.

Digital and Social Media Initiatives

• The Company strengthened its presence across Facebook, Instagram, YouTube, X, and LinkedIn, with a cumulative social media follower base exceeding 23.05 lakh. Targeted campaigns leveraging contextual content formats drove engagement across key themes including offers, product promotions, digital services, fraud awareness, CSR and more. These initiatives delivered over 2.20 crore clicks, 101.70 crore reach, and 330.30 crore impressions

• Multiple digital media campaigns were also launched in FY 2025-26 achieving a reach of 47.04 crore. The promotions spanned across leading sites and platforms, leveraging diverse genres including news, social media, OTT/CTV, and publisher networks to ensure high visibility

• To drive brand awareness and product visibility, the Company executed influencer-led campaigns, including a regionally focussed festive campaign (#GrandAarambham) anchored by Cricketer R. Ashwin that achieved 10.6 crore views and a cumulative reach of 5.72 crore, and a targeted influencer campaign for the Flipkart SBI Card delivering 4.67 crore views and over 10 lakh clicks

• The SBI Card MILES influencer campaign featuring Shahid Kapoor, executed in the previous financial year, was recognised with 2 Abby Awards this year

RISK MANAGEMENT

The Company has a robust risk management framework, based on regulatory guidelines and industry best practices, comprising of policies, procedures, activities, and tools that helps it to identify, assess, control, monitor, mitigate, report and govern risks. Its risk management framework makes use of efficient tools and analytics to create insights, which enable its senior management to manage risks within the internal and external organisational context by making sound and informed risk-based decisions.

The risk management process involves a series of actions designed to reduce or eliminate potential losses, which emanate from known or unknown risks. Accordingly, a risk management framework has been implemented to enable the identification, assessment, aggregation, and reporting of risks prevailing in the processes. The risk management process is subjected to periodic review to deliver assurance that it remains appropriate and effective, aligned with the emerging risks.

The Board, along with its various committees, is responsible for overall corporate governance which includes oversight on operational, market and credit risk. The Board of Directors is responsible for approving and reviewing policies and strategic issues, which are crucial for the organisations overall growth and development and achievement of its strategic and business goals. It approves the overall Risk Management Framework, including risk appetite, data privacy, and significant technology-related risks. Board-designated committees, namely, Risk Management Committee of Board (RMCB), Audit Committee of Board (ACB), Stakeholders Relationship and Customer Experience Committee of the Board (SRCEC), IT Strategy Committee (ITSC) and various internal management committees, including Enterprise Risk Management Committee (ERMC), Operational Risk Management Committee (ORMC), Third-Party Risk Management Committee (TPRMC), Compliance Review Committee (CRC), Credit Risk Management Committee (CRMC), Information Security Committee (ISC), Data Privacy Committee (DPC) and Product Governance Committee (PGC) are in place for monitoring business performance and monitoring and management of various risks. The senior management is accountable for implementing the Risk Management Framework, ensuring ongoing monitoring and escalating breaches within defined timelines.

The major risks faced by the Company are credit risk, operational risk, liquidity risk, regulatory risk, reputation risk, strategic risk, Information security risk and Third-party/ Supply-Chain risk. The Company has formulated various policies, including Risk Management Policy, Compliance Policy, Credit Risk Policy, Collection Policy, Fraud Risk Management Policy, Third-Party Risk Management Policy, Information Security Policy, Cyber Security Policy & Data Privacy Policy etc., to delineate comprehensive architecture for managing these risks prudently. The Company has adopted qualitative and quantitative parameters to assess the materiality of risks to be included in its risk universe. This risk universe is reviewed and updated annually. The Board-approved Risk Management Policy provides guidance to the management on the desired level of risk for various types of risks and helps steer critical portfolio and strategic decisions. The Company has a Risk Appetite Framework that consists of all the Key Risk Indicators and Risk Appetite statements, their performance is reported to ORMC and ERMC.

Credit Risk	Credit risk is the risk of a financial loss if the customer fails to meet their contractual obligations. Being a credit card company with retail and corporate portfolio being the earning assets, credit risk arises from all transactions that give rise to actual, contingent, or potential claims against any borrower. The goal of credit risk management is to maintain asset quality and concentration at individual exposures as well as at the portfolio level. As card dues are mostly retail in nature and are payable monthly, the assessment and monitoring of the credit portfolio is done through a review of the cardholders repayment performance and outstanding in various buckets. Besides, the Company has detailed portfolio monitoring for the corporate card portfolio as well. The collection of dues is also geared towards bucket-wise segmentation, as the behavioural pattern under different buckets differ.
	The Company uses sophisticated Machine Learning based analytics and models to continuously perform a risk rating of the portfolio for determining the acceptability of risk, drawdown ability, credit limits, eligibility and sanctioning of authorisations, eligibility for instalment-based balance conversions and review frequency. Large and risky exposures for the Companys corporate card portfolio are independently vetted by the risk management department and approved by the suitable credit committee. Risk models are governed by a Model Risk Governance process covering the life cycle of all risk models from inception, methodology, discrimination power, accuracy, and stability, to model calibration and retirement.
Operational Risk	Operational risk is defined as the risk of loss resulting from inadequate or failed processes, people, and systems or from external events. It includes legal risk but excludes strategic and reputational risk. The Company has set up a comprehensive Risk and Controls Self-Assessment (RCSA) process for documenting, assessing, and periodic monitoring of various risks and controls. Risks are assessed for their acceptability or unacceptability by measuring their frequency and impact. An incident reporting mechanism for reporting operational risk incidents is in place. Further, Governance Risk and Compliance (GRC) tool has been implemented which has significantly improved our risk-aware decision making, regulatory resilience and operational efficiency, especially given the increased focus on incident management, risk governance and regulatory compliances. All outsourcing arrangements are examined and approved only after a due diligence process, including due diligence for financial reputation information security, compliance, and business continuity risk assessment. The Business Continuity Plan framework is in place to ensure continuity of service to its large customer base. The effectiveness of the approved Business Continuity Plan framework is tested for all identified critical internal activities to ensure continuity of services and readiness to meet various contingency scenarios. The learning from the BCP exercises is used as input to further refine the framework. The Company has strengthened its data loss prevention systems and deployed various controls to ensure the information/data of customers, stakeholders, and employees are secure. Information Security Committee regularly reviews the performance of key information and cyber security metrics and provides directions to mitigate risks. All operational risk issues are reported to ORMC committee on monthly intervals and committee provides direction to enhance risk assessment, measurement methodologies and tracking.
Liquidity Risk	Liquidity risk arises when a Company is unable to meet its payment obligation when they fall due. This may be caused by the Companys inability to liquidate assets or obtain funding to meet its liquidity needs. The Asset Liability Management (ALM) Policy of the Company stipulates a broad framework for liquidity risk management to ensure that the Company can meet its liquidity obligations as well as withstand a period of liquidity stress. Pursuant to RBI Circular on Liquidity Risk Management Framework for NBFC, the Company has introduced various key indicators in liquidity risk appetite to provide early warning signals.
Regulatory Risk	The Company utilises an automated tool to ensure adherence to regulations, tracking the completion of all compliance tasks. All key issues are highlighted to Enterprise Risk Management Committee, Operational Risk Management Committee and Compliance Review Committee. In addition, the Company performs independent annual assurance testing to comply with regulatory guidelines.
Reputation Risk	As a part of the service industry, managing reputation risk is of paramount importance. Therefore, the Company monitors customer complaints resolution, social media complaints, and negative media incidents and obtains real-time feedback to measure the voice of customers.
Strategic Risk	Strategic Risk arises due to a wrong business model or lack of medium- or long-term planning. It may also arise due to a lack of awareness about competition or a changing business environment. The Board is actively engaged in providing strategic direction to the Company. The Company is constantly trying to introduce innovative products to maintain and increase its competitive advantage in the industry.
Third-party Risk	The Company engages with multiple third parties for various services across geographies. Failure to manage risks arising out of Third-Party Risk may result in significant financial loss, reputational damage, and/or legal and regulatory issues. The Company has accordingly adopted a Third- Party Risk Management (TPRM) Policy detailing guidelines on Third-Party risk assessments. To minimise information and data security risks arising from third-party relationships, the Company has established a mature Third Party Risk Management (TPRM) framework. All vendors and third parties are required to comply with the Companys Information Security and Cyber Security policies, supported by structured due diligence, contractual controls, and ongoing monitoring.
Data Privacy Risk	Company is addressing data privacy requirements through a structured program aligned to stipulated regulatory timelines under the Digital Personal Data Protection Act (DPDPA), 2023. The Company has its Data Privacy policy framework and has established foundational governance to meet DPDPA compliance requirements and to ensure lawful, transparent, and accountable handling of personal data.
Information & Cyber Security Risk	Information and Cyber Security risk continues to remain elevated due to expanding digital footprint of the Company, growing reliance on third-parties evolving threat sophistication including AI- driven attack vectors, and emerging geopolitical developments impacting the overall threat landscape. The Company manages these risks through a strong governance-led framework aligned with regulatory requirements and industrys best practices. The Information Security and Privacy policies are well-established and aligned to applicable regulatory expectations, providing a robust foundation for safeguarding the Companys information assets. The Company has implemented multiple detective, preventive, and corrective controls in line with a ‘defence in depth strategy to minimise risk exposure. Periodic Cyber Security audits and independent assessments are undertaken to validate adherence to regulatory and compliance obligations. The Company continues to remain focussed on maintaining strong compliance posture, including continued adherence to latest PCI- DSS & ISO/IEC 27001:2022 standards.

The Company has also adopted a stress testing methodology to identify, measure, monitor and control risk concentrations to evaluate financial stability. The Company computes the impact of macroeconomic variables on the profitability of the Company, and accordingly, the requirement of additional capital is computed in three scenarios vis., Baseline (most likely expected future outcome based on current assumptions and forecasts), Moderate (plausible but unfavourable situation that could reasonable occur), and Severe (an extreme but plausible event that could significantly impact the organisation). This enables the Company to be prepared for dealing with all possible adverse situation that may occur in future.

Operations and Customer Servicing

The Company remains committed to delivering superior customer experience through continuous enhancement of its services. During the year, the Company has taken several initiatives which aim at enhancing interactions and delivering seamless, personalised services to its valued customers.

The Companys customer service functions and centres are dedicated to improving overall customer satisfaction through proactive governance, process simplification, and technology driven service enhancements, ensuring every customer interaction is smooth and satisfactory.

Enhancing Customer Experience

1. Reduction in Customer Complaints & Strengthening Customer Experience

The Companys strong focus on root cause elimination, proactive governance, and experience simplification, has resulted in a sustained reduction in customer grievances.

• Sustained Complaint Reduction:

The Company achieved a significant reduction in customer complaints over the past two years, recording a 39% year-on-year decline in customer complaints in FY 2024-25, followed by an additional reduction of 17% in FY 2025-26. Total complaints dropped from 193,971 to 160,221 during the period. This improvement reflects the Companys consistent execution on complaint root cause resolution, product and process redesign, and expansion of digital self service capabilities.

• PROJECT SAARTHI

- Strengthening Governance & Quality of Redressal:

In line with the Daksh Advisory, the Company launched Project SAARTHI (Strategic Assistance for Accelerated Resolution and Timely Handling of Issues) effective April 1, 2025 which mandates senior management to review 20 critical complaints/ grievances. The program institutionalises senior level oversight on complex and sensitive grievances, with a strong emphasis on quality, resolution effectiveness, and regulatory defensibility, thereby strengthening customer trust and governance outcomes.

• E3 Program - Escalation Elimination Excellence:

The E3 framework continued to mature further as a structured enterprise-wide mechanism for escalation management and systemic issue resolution. During the year, around 227 Root Cause Analyses were identified, of which 208 were resolved, leading to meaningful reduction in repetitive complaints through targeted process simplification, policy changes, and technology enhancements.

2. Customer Retention & Attrition Management

• Sustained Focus on Customer Retention:

Customer retention continues to remain a key strategic lever for enhancing customer lifetime value, portfolio stability, and cost optimisation, complementing new acquisitions, through data led engagement strategies, proactive outreach, and service driven retention interventions.

3. Digital Experience and Omni-Channel Enhancements

Digital transformation remained a core pillar of Companys customer service strategy during the year, with investments focussed on enhancing speed, convenience, self service capabilities, and real-time resolution across customer channels. Key Initiatives are:

• Speech to Text Analysis Platform

The Company implemented the Speech to Text analytics platform during the year, enabling parallel call recording and text ingestion with ready to use analytics capabilities. This has created a scalable foundation for voice of customer insights, compliance monitoring, and early risk identification thereby strengthening service quality and operational oversight.

• Real-Time Digital Payments Enablement

The Company enhanced its payment ecosystem by introducing real-time IMPS, enabled through direct API integration with SBI, improving payment acknowledgment and customer confidence. Additionally, the Company introduced ‘Pay Now Payment feature on WhatsApp for delinquent customers, enabling instant payments in a familiar digital interface, thereby improving payment adherence and ease of use.

• Live Chat - Digital-First Assisted Support:

The Company further scaled its 24x7 Live Chat, which now handles approximately 80,000 chats per month, while maintaining first response time under 20 seconds. The premium customer base now has access to dedicated Live Chat icons within the SBI Card mobile app, enabling priority access and superior service experience.

• Proactive & Automated Servicing Initiatives:

Automated NOC issuance, reducing turnaround times and manual service requests.

Auto debit enhancement, with debit triggers moved to improve collection efficiency and reducing delinquency risk.

Real-time PIN change via IVR, now context-driven for faster resolution and enhanced self service adoption.

• Premium Experience Enhancements

Aurum credit cardholders can now generate multiple QR codes in advance for airport lounge access, ensuring seamless, hassle-free usage across multiple visits.

These initiatives are part of the Companys ongoing efforts to provide a seamless, personalised, and convenient experience across all customer touchpoints. The Company is dedicated to enhancing customer satisfaction and loyalty through continuous innovation and improvement in its services.

TECHNOLOGY

The Company has established a scalable IT architecture that supports all business functions across the organisation. In addition to a robust backend infrastructure, the Companys customer-facing IT systems such as its website, mobile application, chatbot, and Interactive Voice Response (IVR) services provide convenient access to customers for essential services through multiple digital touchpoints.

The Company further expanded its digital sourcing capabilities through multiple partner alliances, including PhonePe, Tata Neu, Flipkart, Apollo. During the year, the Company migrated its campaign management to a hyper-personalisation platform that delivers customised campaigns based on individual customer preferences and behaviours. The platform has been integrated across mobile applications and websites, enabling better customer insights and more targeted engagements.

The Company also introduced a Conversational AI platform on WhatsApp. The platform enables instant alerts for declined transactions, provides proactive support for overlimit transactions, and customer re-engagement during online application journeys to reduce customer drop offs. In addition, premium customers now benefit from 24x7 real-time assistance through a live chat platform, improving accessibility and overall service experience.

In the area of Artificial Intelligence, the Company integrated with MS Copilot, a personal AI assistant aimed at enhancing productivity, streamlining workflows and simplifying complex tasks. These initiatives reflect the Companys continued commitment to leveraging advanced technologies to deliver superior customer experience, drive operational excellence and create long-term value for stakeholders.

The Company continued to strengthen its technology ecosystem during the year by modernising core technology stacks and enhancing enterprise resilience. Key initiatives include large scale Red Hat Enterprise Linux (RHEL) upgrades, and critical platform enhancements across the API Gateway, statementing and fraud control platforms. Compliance processes were streamlined and integrated into core systems through Automated Functional Assurance (AFA) and Software Bill of Materials (SBOM) frameworks, enabling a secure, standardised, and audit-ready technology environment.

COMPLIANCE

The Company remains committed to maintaining the highest compliance standards and ethical business conduct by adopting a well-structured and independent compliance program that adheres to all regulatory and ethical requirements. It has established a comprehensive compliance framework to effectively manage all compliance and regulatory risks. This framework includes a Board-approved compliance policy outlining the Compliance governance structure, detailed Code of Conduct guidelines, and other essential elements. The Company also has a Board approved Fair Practice Code, KYC/ AML Policy and Compliance Policy in place to ensure ethical and compliant business conduct.

The Company has an established comprehensive shared framework of prevention, detection, reporting, and mitigation. This framework has been developed with a specific focus on maintaining adherence to all applicable regulatory norms with a strong operating rhythm through regular reviews with the senior management team, multiple Committees and Board.

A functional compliance framework has also been set up, wherein each function is educated on its regulatory obligations; metrics of their processes are prepared to ensure compliance and an ongoing tracking/review is conducted in the Compliance Review Committee. The Compliance Program also has a proactive assurance process that tests the controls governing key compliance areas.

The Company reviews all new products, processes, and business initiatives to ensure that its internal policies and processes adhere to the regulatory requirements. To strengthen compliance awareness across the organisation, the Company conducts employee awareness and education campaigns on key compliance themes, regulatory obligations through various modes like e-learning sessions, leadership connect, focus group sessions, location connect, online knowledge checks etc. These initiatives support continuous employee education and reinforce a strong culture of compliance among both new and existing employees.

INTERNAL AUDIT

The Companys Internal Audit function provides independent and objective assurance to the management and the Audit Committee of the Board on the effectiveness of risk management, governance practices, and regulatory compliance.

The Internal Audit team is responsible for planning and executing risk-based internal audits across various functions and processes. As part of the audit planning process, key business and operational risks are identified through comprehensive risk assessment exercises. The internal audit team ensures that all identified material risks and corresponding control mechanisms are adequately evaluated within the scope of the audit process.

The audit methodology incorporates elements designed to assess potential risks to organisational business performance, strategic objectives, business sustainability, and reputational risk. All key risk processes are periodically reviewed and audited to ensure that they address the potential risks and are correctly implemented to align with regulatory and organisational requirements.

The Internal Audit function of the Company operates under the supervision of the Audit Committee of the Board, thereby ensuring its independence and objectivity. The effectiveness of internal controls in terms of the Companys internal processes and regulatory guidelines is regularly reviewed by the ACB. Appropriate recommendations and corrective directions are issued, wherever necessary, to strengthen governance and compliance standards across the organisation.

HUMAN RESOURCES

The Company continued to strengthen its talent base in FY 2025-26, with an employee base of over 4,200 as on March 31, 2026, supported by a deeply experienced senior leadership team with an average tenure of 12+ years. The year marked a strong acceleration of the Companys digital first strategy across the employee lifecycle including but not limited to hiring, development, HR services, etc. These efforts enhanced engagement, improved connectivity and facilitated sustained career growth, contributing to a future-ready, secure and highly engaged workforce.

Excellence in Talent Acquisition: Building a Diverse and Equitable Workforce

The Company continued to enhance its talent acquisition framework through deeper stakeholder collaboration, improved hiring governance and technology-enabled recruitment processes. The focus remained on attracting high quality talent, strengthening internal capability and building a pipeline aligned to business priorities. The successful rollout of the Prime Minister Internship Scheme (PMIS) broadened access to high potential early career talent.

During the year, Diversity, Equity and Inclusion (DEI) remained a core pillar of our strategy, reflecting the Companys commitment to providing equal employment opportunities and fostering a diverse workforce. Approximately, 29% of total hires during the year were from diverse talent segments, with focussed efforts to enhance gender diversity through the identification of roles well-suited for women professionals. The Company also partnered with NGOs and participated in targeted job fairs to broaden access to employment opportunities and attract talent from diverse backgrounds. Through these initiatives, SBI Card continued to strengthen an inclusive workplace culture that values merit, fairness and equal opportunity.

Digitising the HR Value Chain

Digitisation remained a key driver of the HR agenda, enhancing operational efficiency, strengthening data security and elevating employee experience across the value chain. Automation and data-driven decisions were embedded across processes, enabling faster turnaround times, improved accuracy and stronger employee engagement. Key interventions included:

• Employee self-service module redesigned for simplicity and speed

• Next-generation payroll platform-secure, smart and effortless, with advanced security including multifactor authentication

• Digital enhancements across Performance Management and Talent Management system

Together, these initiatives reflect a deliberate shift toward scalable, secure and future-ready HR systems, directly supporting the Companys long-term growth strategy.

Building Digital Fluency and a Culture of Continuous Learning

The Company continued to invest in leadership development and succession planning through strategic partnerships with MDI, ISB, Emeritus and IIMs, alongside managerial development programs with the Great Managers Institute — strengthening the leadership pipeline for tomorrow.

To drive digital transformation, employees were equipped with advanced technical and analytical skills through specialised training in SQL, Python, PySpark, Power BI, GenAI, ROI analytics and Copilot for Leaders — fostering digital fluency at scale.

Deepening Employee Engagement

Employee engagement was bolstered through structured communication platforms such as quarterly MD & CEO Townhalls and CPO Connect - ‘Samwaad sessions. These were supported by initiatives like the ‘AMIGO buddy program, Womens Day, Family Day celebrations, festival engagements and thematic awareness drives - collectively fostering inclusion, morale and cultural cohesion across the organisation.

Prioritising Employee Well-being

Employee well-being was addressed comprehensively under the annual theme ‘Embrace Harmony for Holistic Wellbeing, encouraging balanced self care and overall wellness. A wide range of initiatives were delivered across the five wellness pillars - Spiritual, Professional, Personal, Intellectual and Environmental - through virtual learning series, onsite nutritionist & psychologist consultations, annual health check ups, teleconsultation support and programs focussed on emotional and mental well-being, nutrition and financial wellness.

CORPORATE SOCIAL RESPONSIBILITY

During FY 2025-26, the Company advanced its CSR agenda with a focus on enhancing community infrastructure and supporting diverse sections of society, including youth, women, senior citizens and persons with disabilities. Initiatives spanned key thematic areas such as education, skill development, healthcare, rural development, environmental sustainability and disaster management. A detailed account of CSR initiatives and their impact is provided in the CSR section of this Annual Report.

FINANCIAL PERFORMANCE

Presented below is a summary of Companys financial performance for the year ended March 31, 2026, as compared to the previous financial year:

		(Rs. in Crore)
Particulars	FY 2025-26	FY 2024-25	%Change
Total Income	20,708	18,637	11%
Interest Income	9,901	9,347	6%
Fees & Other Income	10,807	9,290	16%
Finance Costs	3,072	3,178	-3%
Operating Costs	9,760	8,007	22%
EBCC	7,876	7,452	6%
Credit Costs	4,962	4,872	2%
PBT	2,913	2,581	13%
PAT	2,167	1,916	13%

Total Income increased from Rs.18,637 crore in FY 2024-25 to Rs.20,708 crore in FY 2025-26, registering 11% YoY growth.

• Interest Income grew by 6%, increasing from Rs.9,347 crore in FY 2024-25 to Rs.9,901 crore in FY 2025-26, broadly in line with increase in average receivables. The portfolio yield in FY 2025-26 stood at 16.5%, remaining largely stable compared to the previous year

• Fees and commission income increased by 15% from Rs.8,725 crore in FY 2024-25 to Rs.9,999 crore in FY 2025-26, primarily on account of higher interchange income with both higher retail and corporate spends

Finance costs declined by 3% from Rs.3,178 crore in FY 2024-25 to Rs.3,072 crore in FY 2025-26. The reduction was primarily driven by lower cost of funds, which improved from 7.4% in FY 2024-25 to 6.6% in FY 2025-26, despite an increase of 2% YoY in average receivables.

Operating expenses increased to Rs.9,760 crore in FY 2025-26 from Rs.8,007 crore in FY 2024-25 on account of higher Spends based costs. Consequently, the Cost to Income ratio stood at 55.3% in FY 2025-26 compared to 51.8% in FY 2024-25.

			(Rs. in Crore)
Particulars	FY 2025-26	FY 2024-25	%Change
Fee and Commission	1,213	633	92%
Employee Benefit Expenses	661	590	12%
Depreciation, Amortisation and Impairment	136	147	-7%
Operating and other Expenses	7,750	6,637	17%
Operating Expense	9,760	8,007	22%

Gross credit costs as a percentage of average receivables declined from 9.0% in FY 2024-25 to 8.6% in FY 2025-26. Net credit costs (after deducting recoveries from bad debts) as a percentage of average receivables also improved from 7.9% to 7.4% during the same period. To manage credit cost effectively, the Company has implemented a wide range of measures across the entire credit card life cycle, including changing in the sourcing/underwriting criteria, model enhancements, use of alternate data, portfolio management initiatives such as credit line rationalisation, refining collections strategies and intensifying efforts.

Earnings before credit costs increased by 6% from Rs.7,452 crore in FY 2024-25 to Rs.7,876 crore in FY 2025-26, Profit After Tax (PAT) increased by 13%, driven primarily by higher revenues and lower finance costs.

Balance Sheet as of March 31, 2026:

• The total balance sheet size increased by 1% from Rs.65,546 crore as of March 31, 2025, to Rs.66,328 crore as of March 31, 2026.

• Net Worth increased by 14% from Rs.13,853 crore as of March 31,2025, to Rs.15,797 crore, as of March 31,2026, reflecting the Companys continued profitability and strong capital position

• Gross Credit Card Receivables increased by 2% from Rs.55,840 crore as of March 31, 2025, to Rs.56,926 crore as of March 31, 2026

ASSET QUALITY

Gross Non-Performing Assets as a percentage of gross advances (GNPA) improved significantly from 3.08% as of March 31, 2025, to 2.41% as of March 31, 2026. Similarly, Net NonPerforming Assets (NNPA) as a percentage of gross advances reduced from 1.46% to 1.04% during the same period.

CAPITAL ADEQUACY AND LIQUIDITY

As per the capital adequacy norms issued by the Reserve Bank of India (RBI) the Companys capital to risk ratio (CRAR) consisting of Tier I and Tier II capital should not be less than 15% of its aggregate risk-weighted assets on the balance sheet and of the risk-adjusted value of off-balance sheet items. The Companys CRAR stood at 25.5% as on March 31, 2026, compared to 22.9% as of March 31, 2025.

Further, in accordance with the regulatory requirements for NBFCs, Tier I capital is required to be always maintained at a minimum of 10%. SBI Card Tier I capital ratio was at 20.0% as of March 31, 2026, as against 17.5% as of March 31, 2025.

The Companys strong credit ratings reflect the robustness of its liquidity position and its sound ability to meet its financial obligations. The Company has access to a diversified funding source, including multiple banking lines, term loans and debentures.

The Company also has a robust Asset Liability Management framework. As of March 31, 2026, the Asset Liability position reflected positive cumulative mismatches across all maturity buckets.

SEGMENT-WISE/PRODUCT-WISE PERFORMANCE

The Company operates in a single reportable segment of Credit Cards, as envisaged by Ind AS 108 Segment reporting, specified under section 133 of the Companies Act 2013, read with Rule 7 of the Companies (Accounts) Rules 2014. Further, the economic environment in which the Company operates is significantly similar and not subject to materially different risks and rewards. Accordingly, the disclosure requirements relating to primary and secondary segments under Ind AS 108 are not applicable.

Key Ratios

Particulars	FY 2025-26	FY 2024-25	%Change
Interest Income Yield	16.5%	16.7%	-20bps
Net Interest Margin	11.2%	10.8%	31bps
Cost to Income	55.3%	51.8%	355bps
Return on Average Assets	3.2%	3.1%	11bps
Return on Average Equity	14.6%	14.6%	-5bps
EPS (Basic)	22.8	20.1	13%
Financial Leverage (Debt/Equity = Liabilities/Tier 1 Equity)	3.6	4.3	-17%
Total Capital Adequacy Ratio	25.5%	22.9%	261bps
Gross NPA	2.41%	3.08%	-67bps
Net NPA	1.04%	1.46%	-42bps

Explanation of Return on Average Equity

Earning before credit costs (EBCC) as a percentage of average receivables stood at 11.7% in FY 2025-26, compared to 12.1% in FY 2024-25. Higher revenue generation during FY 2025-26 resulted in improved profitability over the previous year, leading to an increase in Return on Average Assets (ROAA) to 3.2% from 3.1% in FY 2024-25.

The table below summarises the calculation of these ratios:

ROA tree as a percentage of Average Total Assets

Particulars	FY 2025-26	FY 2024-25	%Change
Total Income	30.9%	30.4%	53bps
Finance Costs	4.6%	5.2%	-60bps
Operating Costs	14.6%	13.0%	151bps
EBCC	11.7%	12.1%	-39bps
Credit Costs	7.4%	7.9%	-54bps
PBT	4.3%	4.2%	15bps
Taxes	1.1%	1.1%	4bps
PAT (ROAA) (A)	3.2%	3.1%	11bps
Average Assets/Average Equity (B)	4.51	4.68
ROAE= (A*B)	14.6%	14.6%	-5bps

Prospects

Indian payment industry, alongside retail lending, has experienced significant growth in recent years. Government and regulatory bodies are actively promoting digital payments nationwide. Credit card penetration in India remains lower than in advanced economies, presenting substantial growth prospects for the Company. To enhance its market share in both spends and card issuance; while ensuring profitable growth, the Company has outlined the following focus areas.

• Leverage Technology: The Company aims to increase its digital sourcing and enable instant card issuance. The process offers digital application submission on the Companys website, Digital KYC (using Digi locker), alternate data integration and instant decision-making based on AI and ML models for the customers with realtime card issuance

• Customer Engagement: The Company is prioritising enhancing its portfolio initiatives/interventions for increased engagement with its cardholders, thus enabling higher spends and receivables. The Company continues to expand its merchant partnerships - both at National and Regional level - to enable higher spends across merchant categories. The Company is also enabling personalised offering across various customer segments with the help of an advanced marketing technology platform. The Company also continues to focus on growing interest-earning assets through higher EMI penetration, which not only helps in higher customer engagement but also in customer retention

• RuPay Cards integration with UPI: Credit card on UPI penetration has shown significant growth on SBI Card portfolio, with Rupay cardholders depicting a strong affinity towards linking their credit cards for UPI payments. Tier 2+ towns and cities have shown higher growth, with 81% of the UPI spends coming from these cities. UPI spends have grown by over 126% from FY 2024-25 to FY 2025-26. The Company will continue to engage its Rupay card customer base for higher spends with targeted campaigns to link their Rupay cards with UPI.