India’s ICICI Bank Ltd. no longer is issuing lifetime, annual fee-free credit cards to any new card customers, an official from the bank tells PaymentsSource, requesting anonymity.
“The bank started issuing lifetime-free credit cards in 2005 to increase its cardmember base,” she says. “But market conditions since then have changed, and it no longer makes business sense issuing cards with no annual fees.”
ICICI also only will tap into existing banking and investment customers as part of its issuing strategy, the official adds.
The bank declined to make an official comment on its card-issuing strategies. However, a customer service representative says existing customers who have a free-for-life card still will not have to pay annual fees.
ICICI Bank has been taking other stern measures recently to solidify its card portfolio, including no longer accepting card applications online, and it has no direct selling agency under contract to solicit card business (
The bank also has cut its card base to 7 million as of December from 9 million in 2008, notes Mrinalini Manral, an analyst with Mumbai-based research firm Dassler Business Intelligence. “Industry losses had peaked in 2009 and are still stabilizing this year,” she says. “Offering nonfree lifetime cards also helps them separate the wheat from the chaff in terms of repayment capacity.”
