MAS to roll out changes on credit card, unsecured credit rules

[CityFarmer]

Belated proposal, should be done earlier...

MAS to roll out changes on credit card, unsecured credit rules

SINGAPORE — From Dec 1, the Monetary Authority of Singapore (MAS) will roll out changes to rules on credit card and unsecured credit.

The MAS said the changes are aimed at improving lending practices by financial institutions and enabling individuals to make better borrowing decisions.

The key policy changes, according to MAS, are:

(a) Financial institutions will be required to review a borrower’s total debt and credit limits before granting a new credit card or unsecured credit facility, or increasing the credit limit on such facilities. This is to enable a more realistic assessment of an individual’s borrowing capacity.

(b) Financial institutions will be required to disclose to individuals who roll over their credit card debts and revolving credit facilities the potential cost of doing so and how the debt will accumulate. This will help borrowers make more informed credit decisions, taking into account the total cost of borrowing.

© Financial institutions will be required to obtain a borrower’s express consent for the amount of each credit limit increase. This will ensure that credit limit increases are not extended to borrowers unless they agree to such increases.

(d) Financial institutions will not be allowed to grant further unsecured credit to individuals whose unsecured debts with those financial institutions are more than 60 days past due, until all past due amounts are paid. Other financial institutions will also not be allowed to grant new cards and unsecured credit facilities or increase credit limits on existing facilities. This will help individuals who already have difficulties repaying their existing debt avoid getting into further debt problems.

(e) Financial institutions will not be allowed to grant further unsecured credit to individuals whose aggregate interest-bearing outstanding unsecured borrowings across all financial institutions exceed 12 months of their income for 90 days or more. This includes not being able to charge further amounts to all existing unsecured cards and unsecured credit facilities. Financial institutions will also not be allowed to grant new unsecured cards and unsecured credit facilities. This will help individuals who have already accumulated high levels of debt through credit cards and unsecured credit avoid accumulating further debt,

The MAS said the proposals will be implemented in stages.

Borrowers will have a transition period of 18 months to re-evaluate and pay down their existing borrowings to within the aggregate limit on credit card and unsecured borrowings.

The MAS is studying if more time should be extended to borrowers whose current aggregate unsecured debt significantly exceeds 12 months of their income. The MAS is also seeking public feedback, by Oct 10, on the draft amendments to the Banking (Credit Card and Charge Card) Regulations and to the relevant MAS Notices arising from these rule changes. The consultation paper can be found at MAS’ website.
http://www.todayonline.com/singapore/mas...edit-rules

[Dividend Warrior]

Fortunately, I have never owned a credit card before.

[felixleong]

yeah they are so wols, should had done this long long ago
but still I'm glad that they have such measures

I have seen quite a few friends getting into trouble with credit cards
with all the bad experience, I only own just 1 credit card and have never used it before, its just here in case
best is still debit card, just spend what you have.

nowadays I'm just seeing too many youngsters going into debt

[specuvestor]

MAS late in this cycle but govt was relatively early on property. Might have been earlier if reshuffled Ma out instead of waiting for GE. China has been early on equity curb, trust loans and property. Being early will avoid major economic shock and hostage by the markets. Watch India unfolds.

[sgd]

sometime is good to have credit card, yes interest rates are very high but sometimes in emergency situations really bo pian you need cash or credit fast maybe late at night emergency where to get it? Even ah long also asleep will tell you to come back tomorrow, at least having credit card that avenue is available at anytime 24hr.

Debit card doesn't work overseas right?

[smallcaps]

Cancel credit cards, easier for home loan application.

[barista]

credit cards are more for convenience, not for using it as leverage tool. sometimes having the right credit card could provide some savings as compared to paying in cash. eg. POSB everyday card on SPC petrol....etc

[Temperament]

Credit cards are really good for people who can spend within or better below their means. Why? Like shopping at Giant and many different outlets, there are at least 5 % discount for your purchases. Sometimes, discount of certain purchases can even go up to 10, 20 % or more during "promotion" i remember i have 3M Nomad car mattresses free because of paying by credit card many years ago. i am still using it in my car.
And for some people when they have walked into a dead end road it is better to owe the credit cards companies than "Tai Yee Loong". At least you won't be in danger of being beaten up or even your life and family are at risk of "AH LOONG".

[Contrarian]

Bro, u hit the nail on the head.

From home measures to car loans to childcare to traffic to credit limits, very fire fighting style.

Open Up Banking --> 6-9 mths credit limits ---> A group of indebted spenders.

World Class Fire Fighters.

Belated proposal, should be done earlier...

MAS to roll out changes on credit card, unsecured credit rules

SINGAPORE — From Dec 1, the Monetary Authority of Singapore (MAS) will roll out changes to rules on credit card and unsecured credit.

The MAS said the changes are aimed at improving lending practices by financial institutions and enabling individuals to make better borrowing decisions.

The key policy changes, according to MAS, are:

(a) Financial institutions will be required to review a borrower’s total debt and credit limits before granting a new credit card or unsecured credit facility, or increasing the credit limit on such facilities. This is to enable a more realistic assessment of an individual’s borrowing capacity.

(b) Financial institutions will be required to disclose to individuals who roll over their credit card debts and revolving credit facilities the potential cost of doing so and how the debt will accumulate. This will help borrowers make more informed credit decisions, taking into account the total cost of borrowing.

© Financial institutions will be required to obtain a borrower’s express consent for the amount of each credit limit increase. This will ensure that credit limit increases are not extended to borrowers unless they agree to such increases.

(d) Financial institutions will not be allowed to grant further unsecured credit to individuals whose unsecured debts with those financial institutions are more than 60 days past due, until all past due amounts are paid. Other financial institutions will also not be allowed to grant new cards and unsecured credit facilities or increase credit limits on existing facilities. This will help individuals who already have difficulties repaying their existing debt avoid getting into further debt problems.

(e) Financial institutions will not be allowed to grant further unsecured credit to individuals whose aggregate interest-bearing outstanding unsecured borrowings across all financial institutions exceed 12 months of their income for 90 days or more. This includes not being able to charge further amounts to all existing unsecured cards and unsecured credit facilities. Financial institutions will also not be allowed to grant new unsecured cards and unsecured credit facilities. This will help individuals who have already accumulated high levels of debt through credit cards and unsecured credit avoid accumulating further debt,

The MAS said the proposals will be implemented in stages.

Borrowers will have a transition period of 18 months to re-evaluate and pay down their existing borrowings to within the aggregate limit on credit card and unsecured borrowings.

The MAS is studying if more time should be extended to borrowers whose current aggregate unsecured debt significantly exceeds 12 months of their income. The MAS is also seeking public feedback, by Oct 10, on the draft amendments to the Banking (Credit Card and Charge Card) Regulations and to the relevant MAS Notices arising from these rule changes. The consultation paper can be found at MAS’ website.
http://www.todayonline.com/singapore/mas...edit-rules

[sgd]

All the tai yee loong, my guess they are operating in small groups of at most 2-3 people from overseas location that's why the police always never able to nab these people despite so many island wide raids all they have to show for are are under aged school kids, youth delinquents and other debtors who are forced to work as collectors because these ringleaders never shows their face in public no matter what happens, all they do is talk on the phone and intimidate and get other people to do their dirty work.

You always see the "violence", hang a pig head lah, spray paint, grafitti vandalism to mostly cause embarassment at most burn door but nobody has ever gotten hurt or died from all these so it's all a scam to terrorize people. The youths who commit these vandalism are doing it only for easy money, $50 to $100 just do a bit vandalism but I can bet they are smart enough not to cross the line beat somebody up and risk going to jail.

So actually if you step back and think about it the violence are mostly cosmetic it's all about money someone over the phone trying to scare other people into giving it to them. Sales people employ scare tactics too