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8/05/2004

3 types of credit card customer...

I believe banks usually deals with 3 types of credit card customer.
3 types is:
  1. Always pay on time
  2. Never pays
  3. Always pay the minimum amount or some amount
The first type never contributes to the bank. They only like the customer to the fact that when they use their credit card, the merchant has to pay 2% of the amount they have swiped. But to the consumer, we are winning because the bank cannot charge you anything for it. Some shops in Malaysia don't want to bare the 2% cost hence the will add up to the price. Big shops won't charge anything because they have higher sales and maybe get a better discount from the bank. Definitely consumers must be in this type group.
The second type is a no no to the bank. Even if they charge a hefty interest, the customers will never pay. So, they can only sue them and if they still cannot pay, they can only make him bankrupt and wait him to pay. Chances that they will get 100% back is very small. So, banks would like to stay away from these types of customers as well.
The third type is of course the bank's favourite. You pay only the minimum amount. The balance will get interest charged. People always get confused with interest charges and late payment charges. Late payment charge is worse. Many people falls into this category without realizing it. 1.5% percent a month is of course nothing! Banks will call these people their loyal customers.

No wonder our mother always warn us not to be a slave to the money...



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