The largest private sector lender of the country, ICICI Bank has stopped its lifetime free credit card scheme. With this step the bank has gestured a change in consumer banking strategy.

The lifetime free credit card scheme had been launched by the bank way back in August 2005. It was a drive by the bank to gain major chunk of the market share. This move had brought a new wave of change in the credit card industry as other banks also started fee less regime with their cards.

The global financial meltdown in 2008 hinted many banks to compress their credit card segment as frequency of default payments had taken a toll.

The Indian banks have been visualizing a tremendous rise in non performing assets (NPAs) in their credit and portfolio segment. The figure has almost tripled from 5-8% in fiscal 2008 to 15-20% in 2009.

ICICI has pioneered with its strategy once again. Following its footsteps other banks have also started charging fees for credit cards.

Following its footsteps has been the largest lender in the country, SBI which runs its credit card segment in a joint venture with GE Capital services.

NPAs are forcing banks to shift their frame of focus from the mass market to the premium segment.

Standard chartered bank has withdrawn gold cards from its shelf and is only into selling platinum cards which target the premium segment.

Gold cards are given to customers having an income of Rs1.5-2.5 lakh. These are entry level cards.

An annual income of Rs. 6 lakhs and above qualifies an individual for holding a platinum card.

Some banks like Citibank, HDFC and Axis Bank still continue offering free credit cards.

Speaking on the issue, an ICICI spokesperson said, "We constantly review our product pricing, based on market dynamics in line with our business strategy. Currently, we are not offering free-for-life cards for any new customers. We have a set of existing customers who have been offered a free-for-life card."

"Our credit card product range provides powerful benefits and convenience to our customers and these will be fee-based," he added.

SBI's credit card portfolio has shrunk from three million to 2.8 million in the past two years. Abhay Kumar Singh, chief executive officer, SBI Cards and Payment Services Pvt. Ltd, said: "We are focused on offering strong value propositions to our customers. Right now, SBI Cards offers only fee-based cards."

"Citibank has not altered its credit cards strategy from no-fee to a fee-only structure. We are very much in the market and continue to offer cards with a number of value-adds," said Sandeep Bhalla, business head for cards for Citibank India.

With Indian economy moving ahead steadily towards growth, banks are also showing bullish approach towards business.