Posts Tagged ‘Consumers’
Bank versus consumers
A TIMELY report by the Consumer Rights Commission of Pakistan has focused on the asymmetries in consumer finance in Pakistan that are squeezing the general public. While banks reap record profits (in 2006 the pre-tax profits of all banks was a record Rs123.4bn), the benefits that have been passed on to customers have been inadequate. Most criticised has been the interest spread — generically, the difference between the rate at which a bank lends money to customers and the rate at which it pays depositors for their money — which has remained persistently and unjustifiably high. According to the CRCP report, the spread has ranged between approximately six and 10 per cent between 1990 and 2005, and in recent years has averaged over seven per cent. The banks justify the spread on the grounds that the cost of doing business in Pakistan is high and that their lending rates are reflective of the difficult economic environment here. Consumer rights advocates reject this argument, pointing to the record profitability of banks. At the very least, critics of the banking sector argue that banks have opaque cost structures and the high spread may be hiding inefficiencies within the sector that the consumer is being forced to pay for. The governor of the State Bank, Dr Shamshad Akhtar, has since early in her tenure tried to nudge banks into lowering their interest spreads and while they have come down in the past year, the feeling persists that the reduction has been too little and occurred too slowly.
Credit Card Tips to Save You Money, Time and Worry
Credit cards are sometimes as harmful as they are beneficial if you dont understand deeply how they work or how best to use them to your advantage. So, what should you do to save yourself from having to sell an arm and a leg to repay credit card debts? Here are a few tips to help you stay out of the cooking pot in the first place.
Read the Fine Print: One of the biggest problems that consumers of all kinds face is not reading the fine or small print. Most times because the deal seems just so good, we take it up on impulse before we carefully consider the implications. It is always best to go through the Terms and Conditions governing the deal or promotion and the underlying disclaimers. They may contain more snakes than you may anticipate. It would be arduous, but it is worth in the long run.
Get Rid of Annual Fees: If you have a fairly good credit history, you can opt to call the issuing company and request them to waive the annual fee applicable on your card. If they dont, simply drop it and move on to the next one. After all, you are a reliable borrower, so they should be happy to do business you as you have a low risk of not paying back.
Be Careful with Promotional Checks: A lot of times promotions have another side to it. So, if you receive check, think twice before you dive in. Balance Transfer Fees may be a little elusive sometimes and may just result in fees that you may not want to be involved with.
Watch out for the Due Dates: It is very much advisable that you always watch out for due dates every time, because they are sometimes changed by the credit card companies so they could collect late payment fees and raise your rate.
Try Waiving the Late Fees: If you have never been late before paying your balance and fees, you can call up the credit card company to have them waive the late fees for you. Worst case scenario is that they will refuse it. But it doesnt harm to just call them and try.
Always Pay in Full: Always try to pay in full every single month. Just be over confident and use the credit card like it is you check or debit card. These are funds that you dont own and may be liable for any fees and interest rates applicable on it. So, use it with care and make sure that you pay in full every month.
Give Priority to Credit Union Cards: It is always a better option to use credit union cards since they usually have a lower interest rate in addition to other benefits.
Follow these tips religiously and you may just be saving yourself a few hundreds or thousands every year.