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| Monday, 3 January 2005 |
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Letters | |
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Please forward your letters to [email protected] in plain text format within the e-mail message, since as a policy we do not open any attachments.
What everybody should know about Credit Cards The use of Credit Cards are spreading fast and they have become a safe and a convenient way of making payment. More and more people and traders are turning to Credit Cards to make and receive payment. Further with aggressive marketing by card issuer's use of cash for transactions is being replaced fast by credit cards. Safety-wise this is the best way to carry purchasing power and convenience-wise with inflation catching up fast on your purse carrying a bulky purse is eliminated. Further, if a card holder has the ability to pay the entire balance in the account every month they will be entitled to about 55 days interest free credit. It appears that the cardholders are only concerned about the convenience and the availability of credit. We are a nation prepared to grab any opportunity to obtain credit irrespective of the costs involved. If one cares to look at the charges levied by card companies using Credit Cards is the most expensive way of borrowing in Sri Lanka. Although the cardholders may not be aware apart from interest, there are over 20 types of commission and charges levied by banks. A cardholder will be amazed looking at them. They are: joining fee, annual fee, cash advance fee, late payment fee, over limit fee, cheque return fee, limit enhancement fee, card replacement fee, pin replacement fee, auto pay reversal pay, duplicate statement fee, certification fee, copy of sales advice fee, billing cycle change fee, early renewal fee, re-couriering fee, urgent application processing fee, standing order fee, overseas courier fee, credit insurance fee, remittance fee, card re-instatement fee, over the counter cash fee. Charges vary from Rs. 100 to Rs. 1,750. Virtually there is a charge for any request you make to a card - issuer. The banks do not compensate the cardholders for communications they are compelled to make due to mistakes made by the banks such as incorrect debits, incorrect rate of interest charged, card delivered to a different person, two cards with the same number, delaying credit of deposits, faulty teller machines etc. Although some banks keep the cardholders informed of their charges, most of the banks do not have a schedule of charges. Further, the rate of interest charged to cardholders revolves around 30-32 per cent per annum, which by any standards is exorbitant compared to deposits rates of 8 per cent per annum. Although banks charge a commission from traders the benefit passed on to cardholders by way of an interest free credit period, practically very few customers benefit as a cardholder is expected to pay the full balance in the monthly statement to avail of this concession. Also while banks advertise all other rates of interest at per annum basic only, Credit Card rates are advertised as per month basis, which makes it look nominal at 2.5 per cent to 3.00 per cent per month. To be fair by the banks it should be mentioned that most of the above mentioned charges are avoidable. However, a cardholder carrying a crystalised balance of 10,000 in his account with unavoidable charges will end up paying about 70 per cent by way of interest and charges made up as follows. Interest at 3 per cent per month for one year Rs. 3,600 Annual renewal fee Rs. 1,500 If you have one cash withdrawal per month Rs. 150 x 12 Rs. 1,800 Annual certificate of balance fee -interest paid (for the tax man) Rs. 250 If you have delayed payment once a year Rs. 250 Total Rs. 7,400 Further, it is pertinent to mention that some of the traders do not give discounts when paid by the credit card. It could be very embarrassing having negotiated a discount for it to be withdrawn when the card is produced. In UK, the banks ensure that the price is the same for cash and Credit Card payment. Further withdrawing cash over the counter is the most expensive way of using the card. Apart from cash withdrawal fee of 2.5 per cent interest is charged from day one. If the amount is paid at the end of the month interest at 3.0 per cent per month, the cost will be a staggering 66 per cent per annum. The consumer affairs authority and the Central Bank of Sri Lanka have an obligation to ensure that the cardholders get a fair deal. A.G. WEERASINGHE - Gangodawila. The Election Commissioner has announced that he plans to introduce electronic voting machines in future general elections. The general public should welcome this idea, because of the large number of malpractices observed in the present ballot paper system. At some counting centres, when certain ballot boxes are opened, on several occasions it had been noted that bundles of folded and stuffed ballot papers are present clearly indicating rigging. If one ballot paper is sneaked out of the polling station, an organised gang can perform a chain-reaction of illegal voting. Sometimes ballot boxes are physically removed by force using thugs. Lot of expenses can be reduced by this system; such as printing, manpower necessary at polling stations, counting centers, transport, and the time taken for releasing results. Even in an advanced country like America, in the previous election there was some controversy in one State with regard to the format of the ballot paper printed, because it confused the voter. The matter had to be finally settled by the courts. One important aspect of an electronic voting machine is that it should be tamper-proof. Sri Lanka has expert crooks to tamper any machine, so that it can be misused, and in politics there are always vested parties to encourage such crooks. Sometime back a highly reputed firm supplied ticket machines to the Transport Board, which are tamper-proof. But one expert crook conductor invented a method to issue tickets from these machines, so that the total amount of money collected will be erroneously recorded. The conductor pocketed the difference in the amount between the actual collection and the recorded collection. It is true that the ticket machine is a mechanical one and not an electronic one. Another important aspect is voter education. The percentage of spoilt votes in the past is high. No finite inference can be obtained from this, because in the recent past some voters purposefully spoilt their ballot papers to indicate their displeasure over both major political parties. Out at least a certain percentage will be due to uneducation. When we switch on to an electronic system, voter education will be of an utmost importance. Otherwise major allegations, counter allegations and legal battles will be fought, which will become a threat to the transparency of the system. It should be noted that making the Identity Card compulsory and use of electronic voting machines, we will be able to conduct fair elections and uphold a democratic system. K. P. P. JAYATILAKA - Pannipitiya. Prices of fuel and provisions were jacked up in ravaged areas during the disaster period. Looting went on apace. Both were in the same bracket. On the other end of the scales, humanitarians donated millions of rupees worth of medicines, food and clothing to the afflicted. Whilst the hierarchy of diverse religions met as one to offer relief to the needy, one man interviewed on TV displayed the vacancy of his mind to say he had made the offering 'Sinhala Jathiya Wenuwen.' The revered Krishnamoorthy when he had to enter the US customs declaration form under the cage, 'Race' wrote 'human'. therein lies the solution to our petty parochial partisanship. In multi-ethnic Singapore, everyone is a Singaporian irrespective of the personal ethnicity. Our country was the model for Lee Kwan when he moulded Singapore. Now we have to learn the basics from Singapore but at the moment we are only at the 'plastics' stage. To drive home the truth of our shallow thinking was a company advertising golden bangles and chains at a time we were shown on TV mass burials with the aid of back-hoes. SHARM DE ALWIS - Kiribathgoda. Early morning December 26, I was listening to 'Thought for the day' given by a scholar monk, on Sinhala Service of SLBC at 5.15 a.m., when the latter said about diverting money used for unproductive and useless purposes and utilise that capital for some useful and productive purpose. It struck me, why not divert the money used for drinking alcohol, smoking cigarettes and gambling etc., which is of unproductive nature and instead, utilise that money for the Godly and patriotic purpose of helping the millions of poor victims affected by the tsunami, who are helpless and displaced now in Sri Lanka. I also suggest that people should contribute a quarter of their wages for one day, and help these poor refugees. Let us have a day called 'Tsunami Victim's Day' and all we good Sri Lankan brothers and sisters get-together and do what we can and think of our less fortunate, poor suffering dear brothers and sisters, with a sincere and genuine warm heart. Our country will be blessed undoubtedly, if we do so. I hope the Super Powers will stop the nuclear tests that are harmful to the environment and lead to this sort of devastation. I also hope our good citizens will have a change of heart and give a thought for the less fortunate, amongst us. C. MOHANLAL DE MEL - Moratuwa. |
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