India's SBI Cards and Payment Services posted a first-quarter profit rise on Friday, helped by a drop in provisions for bad loans as asset quality improved.

Backed by the country's largest lender SBI, the credit-card firm said its profit ?after tax ?rose 19.5% ?to 6.64 billion rupees ($68.76 million) for the quarter ended June ?30

Card spending rose as demand for credit remained strong after picking up in the second half of the previous year, driven by higher corporate spending and steady momentum in the retail segment, in ?line with analysts' ?expectations.

Total revenue from operations rose ?3.4% year-on-year ?to 50.41 billion rupees, driven by ?higher card spending

SBI Card's total card spending rose 27% on-year to 1.18 trillion rupees.

?Cards-in-force, or the sum of all credit cards issued, rose 7% from last year to 22.6 million
The company has steadily tightened credit underwriting over the last few quarters to tackle asset quality stress ?and higher delinquencies in credit cards.Gross non-performing assets were at 2.04% as of June-end, compared to 2.41% three months ?earlier

Loan loss provisions and expenses dropped 13.6% quarter-on-quarter and 30% year-on-year to 9.48 billion rupees

Credit costs, a ?measure of provisions for potential loan losses as a percentage of loans, dropped 301 basis points from a year earlier and 116 bps from the previous quarter to 6.5%.