The 3rd Way of Shopping ?

Most probably you are reading this while shopping, waiting for your wife/girlfriend trying on a new dress or shoe? Congratulation... You're never be more relevant to read this article. Wait, what is the 3rd way?

1st way ---> Cash

2nd way ---> Credit Card

3rd way ---> ???

Introducing the NEW concept of shopping...

The whole idea behind 3rd way is to promote responsible shopping within our community. With proper planning, you can avoid spending all your cash on the item you want.

Instead, you can shop and be rewarded with the interest rates from saving the extra cash reward. You can plan to spend your money for a gadgets, a journey or whatever items and get amazing deals and pay in the future, helping you to get the things you want hassle free.

After changing the buying concept, you will arrive at an interesting question: "If shopping could be free from pain of credit and the guilt of cash, what would I buy?". Happy answering...

Yup. This is the new concept that is similar to what introduced by Mach by Hong Leong bank such as its Dream JAR Saving account.

What is Dream JAR Saving account?

• To set your own golds (Samsung S4?)
• Start with just RM50 or more plus a bit of good planning
• Choose the period to achieve your goals in 6, 9, 12 or 18 months
• Save the amount of money set monthly
• Get rewarded and save more with extra cash when you complete your goal through prompt monthly deposits
• Get (not pay) an interest of 2% p.a. on ALL balances compared to regular savings accounts which offer tiered based interest rates - calculated on daily basis

By using the 3rd way of shopping, you don't have to worry about repayments or overspending anymore. What else? Cash rewards !!!

Source: The Third Way of Shopping

Watch the video here

Consolidating Credit Card Debt: 2 Easy Methods in Malaysia

Credit cards have become a part of life in Malaysia. But as much as they make life a lot more convenient; credit cards can also lead to an unmanageable amount of debt. In some cases, credit cards have even led to bankruptcies.

If you have a credit card debt that seems to be spiralling of control, it may be the right time to consider debt consolidation. In Malaysia, there are two common debt consolidation methods that are highly workable.

1) Credit Card Balance Transfer

Credit Card Balance Transfers involve the transferring of money that you owe on your current credit card account to a new credit card.

Balance transfers offer a number of different benefits, including lower interest rate and the ability to simplify your credit card debt payment process. 

How Credit Card Balance Transfers Can Work for Debt Consolidation:

●     If you have accumulated a significant amount of credit card debt, there is a good chance you are currently being charged the maximum interest rate. Based on the tiered interest rate structure adopted by banks in Malaysia, this maximum rate is generally 17.5% p.a.

●     If you are paying the maximum interest rate, you are probably finding it quite difficult to keep up with your credit card debts. High interest rates can cause your credit card balance to rise quickly. For example, if the amount you owe on your credit cards is RM10,000, you are essentially adding RM146 in interest to your debt each month.

●     A credit card balance transfer could give you a break from paying high interest. In some cases, you'll find balance transfer programmes that offer zero interest rate, at least for the first year or so. By taking advantage of one of these offers, you will have a better chance of paying your debt off.

●     Banks often charge a once-off fee of 3% when transferring a credit card balance. However, in the long run you will still end up paying less, due to the lower interest rate.

Example of How Much You Could Save:

Credit card average maximum interest rate = 17.5%

Lowest known interest rate for balance transfer (for a limited time) = 0%

Amount you could potentially save on interest (for a limited time) = 17.5%

2) Personal Loan

The concept of taking out a personal loan in order to pay off credit card debts might sound a little unusual. However, if you take a strategic approach by taking advantage of interest rate differences between personal loans and credit cards, this method can actually work quite well.

How Personal Loans Can Work for Debt Consolidation:

●     If you have accumulated a significant amount of credit card debt, there is a good chance you are currently being charged the maximum interest rate. Based on the tiered interest rate structure adopted by banks in Malaysia, this maximum rate is generally 17.5% p.a.

●     The interest rates on many personal loans are far lower than credit card maximum interest rates. For example, some personal loan interest rates in 2013 can be 9.88% p.a. or less, depending on your loan amount and term. If you are a government servant, the rate dives even lower.

●     If you take up a personal loan with significantly lower interest than a credit card’s, you could technically be paying much less over the long run. The savings you’re getting from your interest could even help offset the charges and fees associated with the application for a personal loan.

Example of How Much You Could Save:

Credit card average maximum interest rate = 17.5%

Known interest rate on a personal loan = 9.88%

Amount you could potentially save on interest = 7.62%

This article is brought to you by iMoney.my - the first website in Malaysia comparing credit cards, loans and mortgages - free of charge and independently.

Higher Credit Card Financing Rates Effective March 2012

Attention to all credit card holders (especially for the following mentioned banks), interest rates for outstanding credit card balances, and late payments will be revised higher. At least 3 banks, namely Hong Leong Bank, Ambank and Citibank already published the rate revision effective March 2012 on respective website.

What did Bank Negara Malaysia (BNM) said?

According to The Star Newspaper, a spokesman from BNM said the repricing of rates was not due to directive from the central bank, explaining that it was done by the banks. "However, the new rates are withing the range stipulated in Bank Negara's credit card guidelines," he told The Star.

Rationale behind the revision

Beautifully, banks said the revision was done to promote sound financial management by saying that the move would encourage card holders with outstanding debts to pay them off. But, what we understand is that for those who are in debt right now, they were being slapped with a higher finance charges plus late payments charges. Meaning, they are being drown from river to sea, pushing them into deeper debt. Is this called sound financial management?

Perhaps, YES, it is a very sound risk management for banks, definitely not card holders. Why banks revise the rates now? Well, we guess that banks are foreseeing a tighter money supply and potential deteriorating quality of loans amid the ongoing European Debt crisis. They have their strong point though.

FAQ

If I am a new card holder, what is the financed rate applied to me?

The highest finance charges will be applied (etc 18% p.a for Hong Leong Bank). The applicable tiered finance charges will only be effective until such time when you have the minimum 12 months repayment record with the bank.

How to prevent Credit Card fraud?

Nowadays, people are using "Plastic Cash" (credit card) to shop and pay for almost everything. With the ease of payment, comes with the ease of fraud. As a wise consumer, we should know how to prevent credit card fraud, thus safeguarding our "plastic money".

Credit card fraud is a serious crime which can cost you and credit card issuers huge losses. Credit card issuers have taken security measures to protect you against such possible frauds. However, you can also take the proper safety measures to avoid from being a victim of fraud.

Here’s what you can do to minimize your risk of being a victim of card fraud:

Safeguard your credit card

• Sign on your credit card immediately after you received it.
• Keep your credit card in the same place in your wallet or purse so that you will notice it immediately if it is lost or stolen.
• Do not lend your credit card to anyone.
• Do not provide your credit card details to an unknown party.
• Do not write down your PIN number on the back of your credit card or keep it in your wallet. Always memorize your PIN number instead.
• Keep the telephone number of your credit card issuer so that you can immediately report lost or stolen cards, unauthorized transaction or disclosure of PIN to a third party.
• Cut your expired credit cards into two when you get a new one.

Check your credit card transactions to avoid unauthorized transactions

• Check all details on the charge slip before signing or confirming the transaction.
• Keep all your charge slips and check it against your credit card statement as soon as you receive it.
• Notify your credit card issuer immediately of any error or possible unauthorized transactions and follow up in writing as soon as possible.
• Destroy all your charge slips before throwing them away.

Source: Banking Info

New Rules on Credit Cards: NO Credit for LOW Credit?

New Measures on Credit Cards had been announced by Bank Negara Malaysia (BNM) to promote prudent financial management and responsible business practices. Summary on the announcement made:

• For new credit card holders, minimum income eligibility is set at RM24,000 p.a
• For cardholders earning RM36,000 p.a and less, the following would be applicable:
• Cardholders can only hold credit cards from a maximum of 2 issuers
• Affected existing cardholders are given up to the end of 2011 to select their preferred issuers.
• Cardholders will also be given at least 2 years to service their outstanding credit card debt for the credit cards that have been canceled for the purpose of meeting this requirement.

• The maximum credit limit extended to a cardholder shall not exceed 2x their monthly income per issuer.
• For affected existing cardholders, a grace period of 2 years will be given to them to meet with the new requirement.

Example of Credit Cards

How about credit card issuers?

• Credit card issuers are required to adopt fair, transparent and responsible approach in marketing and offering of credit cards to consumers
• Can issuers increase cardholders' credit limit without obtaining their consent? NO
• Can issuers offer a credit advance in the form of cheque payable to cardholders, if they did not request for it? NO

Ease of comparison and making decisions...

• Issuers to provide a Product Disclosure Sheet that contains key information on the card's features, fees and obligations of the cardholders.
• Issuers to display prominently alerts to communicate to cardholders the implications of meeting only minimum and partial repayments.
• Annual statements will be issued at the end of each year, providing information on how long it will take to fully pay off the cardholder's outstanding balance and the total interest costs if only minimum repayment made.

How to make Credit Card Infrastructure more Secure and Safe?

• Effective 1 January 2012, transaction alerts via Short Messaging Service (SMS) will be implemented after each transactions are performed
• Effective 1 January 2015, Personal Identification Number (PIN) verification for all card transactions will be implemented

To make our Credit Card safer

Finance Malaysia have a say

The eligibility starts from minimum RM2,000 per month salary is good. We should not give credit to those lower income group as that will only encourage them to spend with credit. But, the maximum credit limit of 2x monthly income is somehow too conservative. In fact, issuers are giving 3x credit limit currently, which is deemed reasonable. 

Problem arise when we purchase a laptop worth RM2,500 for example, and opt for 0% interest repayment scheme. Even though we are capable to repay, but the credit limit balance is reduced by RM2,500 straightaway, and it left very little only.

Understandably, the measures is introduced when Malaysian households debt is considered very high currently. Overall, it is good for the banking systems, and I believe Malaysians welcome the extra security features to be imposed to instill confidence of public on the usage of credit cards.

Source: Bank Negara Malaysia

Bank's Chinese New Year Promotions

Leap, Leap, Leap to greater prosperity in the year of Rabbit.

In conjunction with the coming festive season, banks are going all out to lure their customers from all angle. It ranges from deposit, investment, insurance, credit cards, and of course shopping and dining. In order to stay relevant, Finance Malaysia is proud to highlights some of the promotions.

Deposit

CNY Promotion: Hong Leong Saving Account

CNY Promotion: UOB Deposit

Investment

Public Bank is offering auspicious works of art (prosperity fish, peach, and bowl) to customers who invests a minimum of RM50,000 in Unit Trust, plus RM2,000 in Bancassurance or RM50,000 in Foreign Currency Fixed Deposit.

CNY Promotion: Public Bank (Investment + Banca / Foreign Currency FD)

Eat, Eat, Eat...

Enjoy FREE salmon "yee sang" with your AmBank credit card

Enjoy 'Extravagant 8 Menu' for just RM888++ with Standard Chartered credit cards.

Credit Card Insurance, worth it?

I believe almost every credit card users had been offered a new type of insurance - credit card insurance.

What is credit card insurance?

• it insured you of the outstanding amount owed in your credit card
  
• it covers death and disablement of credit card holders
  
• it charges card holders an insurance premium annually normally
  

And, in my case, it offers me a better plan which only charge me if there is any outstanding credit card loan. If you're a prompt paymaster, this is definitely the better option for you. If you agreed on the deal, all you need is to answer 'YES' through the phone. Then, they will issue a contract notes and mail to your home address.

Ya... Pretty easy and convenient though.
But, is it worth to have such insurance?

Finance Malaysia opine that it is not worth, and its a waste of money because of the following points:-

• Credit card supposed is for our ease of making purchases, especially for those 0% installment deals.
• Those who opts credit card loans would have been due to financial constrain.
• By charging extra premium on top of the loan amount will UP the outstanding loan amount, thus, the monthly repayment.

Special Credit Cards for Hospital? Worth it?

Before checking into a hospital, make sure that you bring your favorite hospital linked credit card next time. Due to stiff competition in credit card industry, special cards which linked to hospital services became a "think out of the box" thing here. Below highlights some of the features for such credit card:

• 2% cash rebate on all expenses at the hospitals
• 20% savings on all hospitals' suites
• 10% savings on all hospitals' charges during admission (excluding doctors' fees)

Fortunately, I had never stay in a hospital before. And due to this, I never experienced the service provided by a particular hospital.

Do we really need such a card?

For me, I will use credit cards to shop, if credit cards can gave me discount /  rebate. Going for shopping can be anytime anywhere as long as I like it. However, going to hospital was not a leisure event, which I do not like to do, and I believe you feel the same. Instead, we should buy a Medical Card for hospitalization.

I think this kind of credit card is meant for those who always visiting hospital, or those old forks. Besides getting discount, cardholders are entitle to fast-admission and earn points for various usage. Good?