HomeLettersStanchart's latest card rip-off

Stanchart’s latest card rip-off

I AM writing to advise you and your readers of the latest method of extracting money from customers adopted by the Standard Chartered Bank’s credit card division.



>Last month I noticed a charge on my card account of $100 000 called “non-revolver”


When I asked the bank what this “non-revolver” charge was they advised me it was a charge that they had decided to impose on customers who paid their card accounts in full and on time and thereby deprive the bank of the opportunity of charging interest.


As most people know, card companies make their money firstly from the merchants.


If you use your card to pay a restaurant bill of say $1 million, the restaurant gets $950 000 and the bank takes the other $50 000 depending on the percentage negotiated.


Secondly, banks charge a high rate of interest on the unpaid balance on your card. By paying my account in full and on time I was being a spoilsport – no interest, therefore some other charge had to be raised.


I have spoken to the card division chief executive and to his credit he did not ignore my complaint, but took it seriously and gave me an explanation, which I could not accept. The charge has just been introduced and if it has always been necessary, why introduce it now and not before? Also, no other card that I know in the world imposes such a charge.


I am driven to conclude that the bank is looking for every way possible to increase its revenue however unjustified that way is. If enough of us protest, maybe they will think again as I know Stanchart is a generally customer-conscious organisation.


A D Colhoun,

Harare.


* WE have previously offered the credit card facility to our customers on the 100% repayment option at no cost. However, given the increasing cost of providing funds under this facility, we introduced a non-revolver fee in August 2004.


Our customers have therefore continued to enjoy a highly subsidised credit facility despite the fact that lending rates for unsecured lending products are now above 300% per annum.


To ensure that our customers continue to be protected in this high interest environment, we are currently communicating directly with all our cardholders advising them of the following changes, which are effective October 1:


* interest rates for the credit card product have been reduced to 17,9% per month;


* cardholders on the 100% repayment option (non-revolvers) will now be charged interest of 6% per month, taking into account the high cost of providing funds to support the facility; and


* the non-revolver fee of $100 000 will no longer apply.


Despite the challenges of high interest rates currently prevailing, we are committed to and continue to lead the way in providing an affordable product and service and hence the measures we have indicated above.


Charlton Goredema,

General manager,

Unsecured Lending,

Stanchart (Zimbabwe).

Recent Posts

Stories you will enjoy

Recommended reading