Bank Negara introduce new rules! Starting 1 October 2011, regardless of when the transactions took place:
“The payment allocation requirement will ensure that payments received from cardholders will be used to settle balances that attract the highest rate of interest first"
Good news to us right? For sure it is!! :)
Unfortunately this is not a good news to the Banks as they will have less profit from Cardholders.
Bank Negara has also implemented following rules:
a) A restriction on the minimum annual income requirement for credit card eligibility set at RM24,000 (from RM18,000 previously);
b) Cardholders earning RM36,000 or less a year allowed to hold credit cards from only two issuers; and
c) The maximum credit limit for those earning less than RM36,000 per year capped at double the monthly income of the cardholder from each issuing bank.
All above changes will definitely reduce Bank's profit.
There are about 3.2 million principal credit cardholders in the country with outstanding credit card debt at RM30.8billion as at the end of 2010, compared with RM26.7billion in 2009 and RM23billion in 2008.
Say due to payment allocation requirement, the Banks get around 1% less profit of the total outstanding debt of RM30.8billion = RM380million loss!!
Think twice before you get into bank shares now.
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KLSE ~ Bank Shares ~ which is the Best?
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