Plastic – the usual term coined for credit cards.
Pre-recession days, a lot of people spend and spend as if there’s no tomorrow. They were never worried because they have their ‘plastic’ to save the day.
From what I understand, credit cards were created so that in case you ran out of cash – most especially during emergencies – you can use it as long as you pay it back.
I have to admit, I was once an credit card fanatic (don’t think I can categorise myself as an addict because I did not have an incident wherein I was able to max out my credit card). I buy things for myself (mobile phones, laptops), pamper myself (spa, food, massage) and at times, when the emergency really does come (air fares) – I use it.
In reality, you don’t notice it at first because for some reason, you do see your total balance due yet, you look at the box that says minimum payment due and you sigh with relief when you see that it has not reached Dhs. 500 yet! Yep, I was once like that too.
In most of the people’s minds, just pay the minimum due and everything will be alright. You can still use your card to purchase stuff that you want without even (at times) considering if you really need it.
News about the recession came, people were getting scared because they might lose their jobs or the company might announce a company-wide cutback and their ability to use plastic for emergencies – pfftt!
Suddenly calls from different banks and credit card companies make up most of your day – promising that you will pay the so-so amount…to probably 3-4 different banks.
Recession came and people lost their jobs.
I stumbled upon a website article about one of the major reason why expats are leaving UAE – credit card defaults.
According to the survey conducted by Orion Analytics, 66% of the departures seen between 2000 and 2009 were all related to the inability to settle their credit card payments or loans.
I remember when all day, my phone will not stop ringing because there will be 3-4 banks offering their credit cards or personal loans! I sometimes get irritated because they would sometimes call at 8:00 in the morning on a Saturday!!
Now that they have this information in hand, I wonder what do they plan to do with it? Are they going to torture those people who still have loans in their banks *gulp* – that if they missed their payment for one day, their collection department will have the right to harass their customer?
I hope not.
To give credit to the people who are continually paying off their loans / credit cards should mean something to the banks right? That these people wants to set it right. They did not want to make a skip. They wanted to finish off what they have started and lead a worry-free life. If they do miss a payment (once or twice is tolerable), the banks should be considerate enough to waive a late fee or just to check why the person has not paid the amount due. There’s a story behind it – it is of course, personal judgment if the person on the other line is telling the truth or not.
I just wish that we should all work together on how we can move forward and not blame each other for what the past has caused.
See the full article here:- http://www.arabianbusiness.com/588255-credit-card-defaults-behind-most-uae-skips