How Many Credit Cards Should You Own?
While multiple cards can offer rewards and better credit access, mismanagement can lead to debt and credit score damage.
The credit card market in India is expanding, with a sharp rise in spending by 10.8% year-on-year to Rs 1.84 trillion in January 2025, according to data from the Reserve Bank of India (RBI).
With banks like HDFC, SBI Card, and ICICI Bank offering specialised credit cards tailored to dining, shopping and entertainment, many people find it useful to own more than one card to maximise rewards.
In such a scenario, a common question arises: How many credit cards should you have?
The ideal number varies based on your financial situation, spending habits and ability to manage debt effectively. There’s no universal answer, but striking the right balance is key to maximising benefits while avoiding financial pitfalls.
Advantages of owning multiple credit cards
Holding multiple credit cards can be beneficial when used strategically. It allows access to higher credit limits, diversified reward structures and improved financial flexibility.
For instance, a travel credit card may offer perks like free lounge access and air miles, while a cashback card can help save money on everyday purchases like groceries and fuel.
Risks of having too many credit cards
Despite the perks, juggling multiple cards comes with risks. Missing payments on any of them can negatively impact your credit score, leading to financial strain. High-end credit cards often carry hefty annual fees, which can quickly add up if not offset by sufficient usage. Experts suggest keeping credit utilisation in check and ensuring payments are made on time to avoid debt accumulation.
With the number of credit cards in India surpassing the 100-million mark in 2024, banks are witnessing a rise in credit card adoption. Despite these encouraging numbers, overextending yourself with multiple credit lines without proper management can lead to financial pitfalls.
Striking the right balance
For most consumers, having two or three credit cards is ideal — one for rewards, another for emergencies and possibly a third for specific expenses. Before applying for new cards, it’s important to evaluate spending patterns and compare offers.
According to PwC’s market intelligence, India’s credit card market is set for significant expansion, with the number of active cards expected to double to 200 million by FY28-29. Responsible usage and timely repayments are the key to reaping the benefits without falling into financial trouble.
Overall, owning a credit card offers financial flexibility, but it should be approached with caution. Misuse can lead to mounting debt and high-interest costs. If unsure, seeking advice from a certified financial expert can help in making an informed decision.
