SBI Card Q4 FY26: Profit up 14% as asset quality improves

Key takeaways from the Q4 FY26 call

SBI Cards and Payment Services Ltd (SBICARD) reported a stronger Q4 FY26, with management attributing the improvement largely to better asset quality and lower credit costs versus the previous quarter. The company also reiterated that growth would remain calibrated, with underwriting and portfolio monitoring staying central amid geopolitical and macro uncertainty.

On the earnings call dated April 27, 2026, MD and CEO Salila Pande positioned the business within India’s rapidly expanding digital payments landscape, while emphasizing a focus on disciplined growth, technology-led underwriting, and collections strength. The company also highlighted continued investment in AI and machine learning to improve product development, service delivery, and risk management.

India’s digital payments context and credit card relevance

Management pointed to structural changes in India’s payments behavior, where transactions are becoming more frequent and smaller in ticket size. The company cited that digital transactions grew almost 11 times between 2021 and 2025, with UPI accounting for almost 80% of overall digital transactions.

Against this backdrop, SBI Card referenced RBI March 2026 data showing credit card spends during the year rising about 12% year-on-year to ₹23.62 trillion, and total cards in force crossing 118.6 million. SBI Card said it continues to be the second-largest credit card issuer, and the largest pure-play credit card player.

Q4 FY26 financial performance: profit and revenue

For Q4 FY26, SBI Card reported total revenue of ₹5,187 crore, up 7% year-on-year versus ₹4,832 crore in Q4 FY25. Profit after tax (PAT) rose 14% year-on-year to ₹609 crore in Q4 FY26 compared with ₹534 crore a year earlier.

Management said the results were in line with what it had expected and communicated during the year. For the full year FY26, total revenue was ₹20,708 crore, up 11% year-on-year, and PAT was ₹2,167 crore, up 13% year-on-year.

What drove the quarter: fees, costs, and impairments

In the published financial highlights included with the call coverage, total income in Q4 FY26 rose 7% year-on-year to ₹5,187 crore. Fees and other revenues increased 13% to ₹2,553 crore from ₹2,259 crore a year ago.

Finance costs declined 10% year-on-year to ₹714 crore from ₹795 crore. Total operating costs increased 24% to ₹2,561 crore from ₹2,073 crore. Impairment losses and bad debts expenses fell 12% to ₹1,097 crore from ₹1,245 crore.

Management also clarified that “other income” included one-offs during FY26, including a provision release and an item related to a tax matter, which lifted the year-on-year comparison.

Balance sheet and portfolio mix: receivables and revolvers

Receivables stood at ₹56,926 crore in Q4 FY26, about 2% higher year-on-year. The company disclosed that interest-earning assets were 54%, while revolver balances were 22%.

Revolve rates have been in the 22% to 24% range over the last two years, and management expects a slight downward bias in FY27. SBI Card said it will continue to focus on building its EMI book.

Margins, funding cost, and operating efficiency

The company reported cost of funds at 6.4% in Q4 FY26, lower by 82 basis points year-on-year. For FY26, cost of funds was 6.7%, lower by 71 basis points. Net interest margin (NIM) improved to 11.1% in Q4 versus 11.0% in Q3, while FY26 NIM improved to 11.2%, up 31 basis points.

Operating efficiency remained a key focus area on the call. Cost-to-income ratio was 57.2% in Q4 and 55.3% for FY26. Management linked the higher cost-to-income compared with prior periods to higher corporate spend, and guided that cost-to-income is expected to remain in the 55% to 58% range in FY27.

Asset quality: credit cost trend and provision overlay

Asset quality continued to improve, with management highlighting a sustained reduction in delinquencies over multiple quarters. Gross credit cost improved by 55 basis points quarter-on-quarter to 7.7%, extending the declining trend seen over the last two quarters.

The company said it is retaining an overlay of ₹220 crore for ECL provisions, citing the annual ECL model refresh and geopolitical uncertainty. It also mentioned a write-back of ₹47 crore, linked to lower stage 2 and stage 3 stocks.

Capital and profitability ratios

SBI Card reported a capital adequacy ratio of 25.5% for Q4 FY26. Return on assets (ROA) was 3.6% for Q4, higher by 29 basis points year-on-year, while FY26 ROA was 3.2%, higher by 11 basis points.

On shareholder payouts, management said the company declared an interim dividend of ₹2.50 per equity share during the year.

Operating metrics: cards, spends, recoveries

SBI Card disclosed new accounts volume of 917K (9.17 lakh) in Q4 FY26, broadly in line with its earlier stated target of 9 lakh to 10 lakh for the quarter. Management indicated that next quarter acquisitions could be in a similar range, consistent with a calibrated growth approach.

Operationally, the call summary also referenced card-in-force at 2.21 crore, up 6% year-on-year, and Q4 spends of ₹115,350 crore, up 31% year-on-year. Recoveries were described as nearing ₹190 crore, with management indicating that recoveries could remain in a similar range as write-offs trend down.

Market reaction and what investors tracked

Market coverage noted that the stock slipped after the Q4 results, with one report stating a decline of about 3%. Separately, a performance snapshot around the results showed SBICARD down 1.12% at one point.

The key investor debate on the call centered on the pace of receivables growth (2% year-on-year), the outlook for revolvers and funding costs, and whether elevated corporate spending could keep cost-to-income near the upper end of the guided range.

Snapshot table: Q4 FY26 vs Q4 FY25

Summary of key operating indicators (as disclosed)

Conclusion

SBI Card’s Q4 FY26 reflected year-on-year profit growth, higher fee-led income, and improving asset quality, while operating costs stayed elevated due to higher corporate spending. For FY27, management reiterated a calibrated acquisition strategy and guided cost-to-income at 55% to 58%, while indicating that the path of further credit cost moderation will depend on macro and geopolitical conditions.