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Are PeeRs here to create jobs or problems?
Feb 6, 2010
Help PRs in credit card debt
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I WAS concerned to read the report, 'PRs, new citizens chalking up huge card debts' (Jan 28), and that most cannot repay their debts. The fact that many of them are newly arrived is a matter of concern.
Credit card issuers should help such card users avoid running up huge debts and solve their problem once they get into debt. There is a solution to problems, at least to most problems.
Some of these people may have earned much less before they came here. The sudden jump in income, large compared to what they took home before - though not much in Singapore terms - may cloud their judgment and encourage them to splurge. They should not run up a bill beyond their ability to pay.
The credit card should be used prudently as a convenient means of payment, not to chalk up huge debts. Foreigners have come here to earn a living. It will do them no good if they get into huge debts just to support people at home. It could land them in big trouble. Then their very livelihood is threatened. They should know when to say no.
Issuers should be more prudent in giving credit cards to such people. Since most of those in debt probably do not have much savings, their spending limit should be fixed without the proviso to allow them to pay a minimum or run up a debt and pay interest on the unpaid portion. Such users should also be restricted to the use of one card from one bank and capped with a realistic spending ceiling.
These and other restrictions will limit what new immigrants are entitled to borrow. It will encourage prudent budgeting and discourage thoughtless spending.
There are of course those whose job and position will enable them to spend more. With stringent checks, banks will be able to ascertain who they are and not offend them. This group will not need restrictions on their spending.
If the banks rush to issue cards to all and sundry, the debtor situation will worsen and the banks will be at the losing end. I hope the banks will put in place measures to protect the wanna-be free spender from himself.
Murali Sharma
Feb 6, 2010
Help PRs in credit card debt
<!-- by line --><!-- end by line -->
<!-- end left side bar --><!-- story content : start -->
I WAS concerned to read the report, 'PRs, new citizens chalking up huge card debts' (Jan 28), and that most cannot repay their debts. The fact that many of them are newly arrived is a matter of concern.
Credit card issuers should help such card users avoid running up huge debts and solve their problem once they get into debt. There is a solution to problems, at least to most problems.
Some of these people may have earned much less before they came here. The sudden jump in income, large compared to what they took home before - though not much in Singapore terms - may cloud their judgment and encourage them to splurge. They should not run up a bill beyond their ability to pay.
The credit card should be used prudently as a convenient means of payment, not to chalk up huge debts. Foreigners have come here to earn a living. It will do them no good if they get into huge debts just to support people at home. It could land them in big trouble. Then their very livelihood is threatened. They should know when to say no.
Issuers should be more prudent in giving credit cards to such people. Since most of those in debt probably do not have much savings, their spending limit should be fixed without the proviso to allow them to pay a minimum or run up a debt and pay interest on the unpaid portion. Such users should also be restricted to the use of one card from one bank and capped with a realistic spending ceiling.
These and other restrictions will limit what new immigrants are entitled to borrow. It will encourage prudent budgeting and discourage thoughtless spending.
There are of course those whose job and position will enable them to spend more. With stringent checks, banks will be able to ascertain who they are and not offend them. This group will not need restrictions on their spending.
If the banks rush to issue cards to all and sundry, the debtor situation will worsen and the banks will be at the losing end. I hope the banks will put in place measures to protect the wanna-be free spender from himself.
Murali Sharma
