Axis Bank, an India-based private sector lender, has increased the interest rate on credit cards from 2.95% to 3.25% per month.
The move will force all Axis Bank credit card holders, who have not repaid their dues, to pay high interest rate on their outstanding dues.
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Axis Bank consumer lending and payments head, Jairam Shridharan, was quoted by The Economic Times as saying that given the economic environment and the risk conditions, they have decided to increase the interest rates for those customers whose cards were originated at lower rates.
“We are moving these customers to market rates. These are a small set of customers and we have to ensure viability of business of these cards. We want to ensure that depending on the risk of each segment, the credit cost per customer is adequately covered,” Shridharan added.
The hike in interest rate by Axis Bank could offset the proposed additional charges on debit card usages on other bank ATMs.
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