A year ago, I received a letter from my credit card company, informing me that the charge for a late payment is $X and for insufficient funds is $Y. I remember that the amounts are quite high, i.e. more than$40. They are excessive.
I called the credit card company and cancelled the credit card. I feel strongly that any charge should be fair and not excessive. The credit card company cannot make profit by over-charging customers. Already, they are making profit from the credit card fees and the transaction fee for each payment.
I hope that the regulator and the consumer association should take up this matter. I feel that business practices in Singapore is becoming very bad, and that consumers are being taken for a ride.
Tan Kin Lian
Hi Mr TAN,
ReplyDeleteRBS credit card does not charge annual fee at all ie free for life. This settled the annual fee issue.
As for late payment or insufficient funds (to make payment), I think this is where the banks or credit card companies make their money.
For those who make their payment promptly, the banks & credit card companies probably do not make much money at all.
As for whether the fees/charges are excessive, no companies will refuse more income. These companies can always cite whatever reasons to support their decision.
starlight
PAP Govt is a pro-business Govt, businesses here are far more important than anything or anyone else.
ReplyDeleteRemember what MCYS chief had said before, "we don't want to micro-manage them"!
Credit cards are good to have, not must have, so why should PAP Govt care so much?
In most cases, late payment charges can be waived by calling them.
ReplyDeleteThere are many, many others who, for their own reasons, will not cancel despite these charges. Besides late payment, some even made partial payments, incurring hefty interest charges.
ReplyDeleteDue to these people the credit card companies can continue their high charges and make profit, never mind the few cancellations like those from Mr Tan.
I believe it is the same for all bad business practices because they have a pool of clients willing or have no choice but to bear with such practices.
To avoid late payment fee, always remember to pay on time. You can also make GIRO payment arrangement for your credit card to avoid the hassle of forgetting repayment schedule. But remember to keep sufficient fund in your bank account.
ReplyDeleteI do not encourage having too many credit cards. Just keep those that you frequently used will do.
Hi Hon Chun
ReplyDeleteThe bank hopes that many customers will not call them, so they can make a large profit from the high charges.
It is better for customers to voice their unhappiness by not accepting the excessive charges.
Pay on time leh.
ReplyDeleteThese charges are only for delinquents. If not delinquent why be concerned.
Consumers should seriously consider other options. I am considering switching to CASH, just like the more conservative generation of Japanese.
ReplyDeleteAs you all know, CASH is KING.
By paying with cash, you are likely to get better discounts. And there is no electronic money trail, good if you are hiding something from your spouse.
Our society is going for cashless and so, carrying a lot of cash to buy big ticket items is not advisable and feasible.
ReplyDeleteExercise some control on the usage of the credit card should be the way to go.
In addition, watch out for any unreasonable and excessive charges imposed quietly and secretly.
starlight
Hi Mr Tan,
ReplyDeleteJust a matter of interest,what happen to the excessive charges you refused to pay. Did the bank forego these changes after you cancelled the credit card?
I do not use credit card often while overseas, but notice that credit card company charges very unfavourable exchange rate, eg they charge 1US $= S $1.49 when the interbank rate is only 1 US $=S 1.45
ReplyDelete@pumpkin,
ReplyDeleteThe bank will allow cancellation of credit card unless all outstanding charges are cleared. The longer you take to clear, the more interest you will incur. The banks will monitor and if you really cannot pay up, they may offer you a "better" deal. It's better to get back some money instead of the customer being declared bankrupt.
Extra charges incurred when you use credit card overseas is due to bank admin charges and Master/Visa charges. From what I know, it's more like 1.2%-1.5% each.
ReplyDeleteSo should we use credit cards overseas? My personal opinion is we should use if we do not have enough foreign cash on hand and we don't visit the country often. It makes more sense to use credit card in that situation than to convert to foreign currencies just for that "last" purchase before we depart back for Singapore. Singapore do not accept US$ here anyway :) Change back from US$ to S$ will just incur more unnecessary losses.
I was hit with a $180 renewal charge for my UOB credit card last week. I tried to call UOB today and was put through a automated system. I really hate this automated system because I have to spend much time hearing all the numbers before I can press. For a busy person or someone who do not understand English well, they may give up along the way.
ReplyDeleteDear Mr Tan
ReplyDeleteThanks for sharing "I feel that business practices in Singapore is becoming very bad, and that consumers are being taken for a ride."
I feel the same way, but have kept quiet because I did not want to seem paranoid or "out-of-touch".
Here's a "trick" a LOCAL bank tried to use on me recently to hit me with late charges.
My credit card charges was due on 30th June (Tuesday).
On 26 June (Friday) at around 12.30pm, I decided to physically queue up at the bank to pay off the charges with my personal cheque. Luckily I asked. The cheque will only be credited to the bank's own credit card company on Tuesday!!
So I decided to pay off the charges with cash instead. Guess what. The money will only be credited to the bank's credit card company on Monday, 29 June.
For everybody's info. I don't have such problems with my Citibank or Maybank credit cards.
Isn't it nice to know how your fellow Singaporean countrymen and institutions are standing up for you in this current crisis.
As an individual Singaporean, you are expected to "stand up for Singapore". Volunteer free articles to magazines, donate blood ... everything free. Your time and contribution is discounted.
But when you need help as an individual Singaporean ... good luck. "Singapore does not owe you a living". Every little bit of "help" grudgingly given is magnified as very valuable to you.
I wonder which system would vendors really prefer, payments through credit cards or nets. What are these vendors paying the credit card companies or nets anyway?
ReplyDeleteLost Citizen
Maybe that's the idea ;)
ReplyDeleteThere is no need to fret over credit card fees. I have never paid a single cent for all my credit cards for nearly two decades now since I had my first one. I also never let any bank charge me the high spread in foreign exchange. This is how I do it:
ReplyDeleteHave a credit card for each country that you visit often. This way, I use that card when I am in that country. So far, this has worked for me and every year when they charge for annual fees, this is what I say when I call them up to ask for a waiver:
After going through all the verification details for my security,
Bank: Thank You Mr. Lim, how can I help you?
Me: I am not in the business of paying credit card fees, for your information I have many banks giving me free credit cards, waive the fees or cancel my cards.
Bank: Wait a moment while I verify your records...
A few minutes later...
Bank: Alright, we will waive the fees, you will see a credit balance in the next month's bill.
Me: Thank You
Bank: Welcome and have a nice day.
Some credit cards give petrol discount and some give meal discount. So it's good to have a few cards to enjoy these discounts.
ReplyDeleteCitibank encourage its credit card customer like me to sign up for "paperless" bill statement but Citibank did not advice me that payment reminder will not be given if opt for paperless.
I ended up got a "late payment notice" from Citibank. Though eventually Citibank waived my late payment charges but time was already wasted to call them and waited for them to answer my call.
It can be quite stressful for me to receive such a late payment notice which it could be totally avoided in the first place.
If I didn't call Citibank to ask for wavier, I would have to pay for the late payment charges.