Tuesday, June 28, 2011

Credit Cards Deadline Coming Up In Six

One of my friends got two shocks recently.

Shock Number One
She found out that by end of December 2011, she would only be allowed to hold two credit cards. The extras have to be cancelled. She would only be given two years to settle the outstanding debts from the cancelled credit cards.

Shock Number Two
She was informed that her maximum credit limit for her remaining two credit cards could only be 2x her monthly income.

In her particular case, she has six credit cards.  When she cancels four of them, she has a combined debt of RM20,000.  But her remaining two credit cards have high credit limits... and she has to settle RM4000 to comply with the new credit limit.

So now she is dizzy thinking of those debts... yes, she is given two years to settle them... but RM24,000 on top of her other debts is a very very heavy burden to pay.  While I pity her, I also think that this is something that Bank Negara Malaysia should have done earlier.

These rules apply to those who earn RM36,000 a year or less.  But personally I think we shouldn't hold more than two cards.  Why two cards?  Just in case one doesn't function.

I once tried life without credit cards.  Hoo boy!  The deal breaker came when I checked into a hotel.  I only meant to stay in Hotel Fairlane for a night but they demanded a deposit of RM600!  It was as if someone without a credit card was immediately under suspicion.  Maybe they thought I gave fake details and was getting ready to run away with their carpet and kettle.

The info is at http://www.bnm.gov.my/index.php?ch=8&pg=14&ac=2226.  This is not NEW info but I think for people like my friend, she didn't realise how bad her financial situation had become until she sat down to do the numbers.

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