05 February 2009

All credit goes to... !!!

I dont understand this. And, if you do, am sure there's something wrong inside your head.

The Supreme Court today upheld an appeal by a bunch of foreign banks to remove the cap on 30 percent annual interest rate on default payments by their credit card subscribers That is, the Supreme Court agreed with the fat cats that its okay to clobber us with 49% interest if we committed the sin of not paying the MAD!!! Yeah, that's mad.

The foreign banks had more than 24 reasons to justify such theivery, some of them being: cost of courier and embossing the card, cost of providing phone banking and internet banking services, cost of sending monthly statements, cost of waiving charges for service reasons, cost of marketing and promotional offers, and cost of rewards and loyalty programmes.

Err, sorry, am no economics pundit. So, let me just think it out in my head.

This means that unless I default on a payment, I dont need to pay for these expenses? Or, to put it another way, if these are expenses that need to be paid for by defaulters, why the heck am I paying something like 33% annually?

First, they rip us off with rotating interest, and then we miss a friggin due date, and you come down on us with a 49% hammer. And, you have the Supreme Court as your best buddy.

Truly, what can I say?!

1 comment:

sudhakar said...

Yes 49% is way too high, and the Credit Card company do charge a lot. But if we feel this is too high, then we pay the bills on time every time, and enjoy free credit of nearly a month. Not to mention if we get the right cards, we can also get cash back.

I have 2 reminders for every card of mine through google calender, that sends me an SMS also. I think I will be considered by these companies as their worst customer.

Every business has the right to run it the way they deem fit, it is not fair to control by law the charges of these businesses, considering their profits are anyway taxed.

Just imagine if government decides to say $10 an hour is too much to charge the US companies for calls handled in India!