New Credit Card Measures can limit (further) rise in household debt.
- Min income from RM18,000 per year to RM24,000 per year;
- Max 2 issuers to issue credit cards for income below RM36,000 per year. (no more option for using Balance Transfer to cover personal debt... good news for loan shark?)
- Max credit limit 2 months salary per issuer (i.e. can get credit limit of up to 4 mth salary from 2 issuers).
However, if consumers are not educated, which lack of spending discipline, they may end up going to "loan shark" as the option for balance transfer no longer available.
Some expert said the Banks actually no longer interested to issue card for those monthly income below RM3k as the purchasing power of these group of consumer is weak. Look at OCBC Titanium and Citibank Cash Back, required annual income level are RM36,000 and RM48,000 respectively.
What's next to control the ever increasing household debt?
How to prove one income is above RM36,000 in order to get card from 3rd issuer? Must submit income documentation as applying for house loan?
There are too many questions related to this new measure, we hope Bank Negara can do a better job.