Thursday, February 12, 2009

Credit card interest rate to reduce by 31 March 2009

The Association of Banks in Malaysia (ABM) has just announced today that the interest rates for credit cards will be reduced by between 0.5% and 1.5% for Tier-1, Tier-11 and Tier-111 credit cardholders while late payment fees will be slashed to a minimum of RM5 and a maximum of RM75 effective 31 March 2009.

Interest rates for Tier-I credit cardholders who promptly settle their monthly minimum payments for retail purchases for 12 consecutive months will be reduced to 13.5% per annum from the current 15%.

For Tier-II cardholders who promptly settle their minimum payments for 10 months or more in a 12-month cycle will also benefit as the relevant interest rate will be reduced to 16% per annum from the current 17%.

Cardholders who don't fall within the 2 categories and who are generally termed Tier-III cardholders will see the interest rate for them come down to 17.5% per annum versus the current 18%.

The present late payment fee of a minimum of RM10 or 1% of the total outstanding balance, subject to a maximum of RM100 will be revised to a minimum amount of RM5 and a maximum of RM75.

This will not have any effect to good paymasters who settle their credit card bill in full payment every month, which is a very good financial discipline allowing them to enjoy 0% interest for at least 20 days, as they will still remain free from any interest charge. For Tier-I cardholders who never default their payment, they will enjoy one of the lowest credit card interest rate in Asia at the rate of 13.5%.

I would advise that although the interest rate will be reduced soon, you should never get yourself into Tier-II or Tier-III, as the compounded interest rate is still very high.


aLan said... Reply To This Comment

我想问一下,那些常有late payment和pay minimum amount的卡主申请房贷/车贷会不会困难?信用卡使用者的偿还记录,其他银行同业可以取得access吗?

Anonymous said... Reply To This Comment

Pay minimum amount is ok.
late payment will have bad record.

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