Banks cut down on credit card business over rising defaults

“In the next six months, we will reposition our product offering. There will be basic, no-frills card which will attract no annual fee, however, the gold and the platinum offering will come at a fee. We will source 50% of our new business from State Bank of India and other bank customers with whom we will launch co-branded cards,” said Gupta.

Axis Bank Ltd, a relatively new entrant in the credit card market with about 500,000 cards, has also made its underwriting practices tougher. “The bank has increased the threshold income level from around Rs60,000 to around Rs1.5 lakh,” Hemant Kaul, executive director at the bank, said. “We are marketing the credit card to bank customers only.”