Friday, September 13, 2013

Change of Credit card rules in Singapore

Source: CNA

In a nut shell, the new changes are

  • Limiting the 'credit' to 12x months of income across all credit cards, credit lines (and all unsecured credit)
  • If it's hit then no more 'credit'
  • Banks need to ensure it.
More info, check MAS website.

But I feel the 12x months income is still pretty high. Most of the unsecured credit facilities charge "2% per month" or around that period. So for example, if a person takes 12x months, then he would end up paying almost 24% of his monthly pay for "interest". Not even minimum balance. If we take a fair assumption of $50 then it still stays around 25% for "credit card payments". Then what about others?

I would guess MAS to further tighten this and IMHO, keeping it to 6 months or lower would be better. Especially with the 'high' interest rates.

No comments:

Post a Comment