Noticing some fine prints behind my Citibank credit card, I scanned through the changes in terms of service with regards to interest rate pretty quickly.
Citibank has joined the ranks of Standard Chartered and Amex offering clients with good paying records to lower their interest rates; and penalising those who aren’t responsible paymasters.
Known as tier pricing, Citibank credit card customers with good paying habits would be rewarded in terms of lowered interest if they have been paying their bills regularly. We’re looking at the due date with at least the minimum sum payable; Should you miss paying at least twice, your interest rate could hit as high as 27% per annum, which means 2.25% compounding interest, 0.25% higher than of the old 2% which works out to be 24% per annum.
And for customers who honor their bills regularly, it’s 1.5% per month, 18% per annum, which means massive savings. I happen to fall in this category, hopefully yours too!
Just read a mailer from Tony, Knight Frank on an article in Business Times talking about lower bank interest rates here at home since key interest rates from the States will be cutting tremendously within the next 12 months , meaning adjustments to our SIBOR (Singapore InterBank Offered Rate). It only means two huge things for people who keep their money in the bank and for people who borrows money to do investments or businesses here at home in Singapore.
The faces of your key interest rates decision makers lol.
Photo Credit: fintag
For People Who Keeps Their Money In the Bank
Chances are you’ll lose out if you keep your money in a savings account during this season if your main purpose is to earn interest for the next few months. Unless the bank is giving you a fixed rate (usually, and very low), you would be suffering from lower interest earning power.
For People who Loans Invests in Property and Businesses
Congratulations, it means lower cost for you! I’d reckon the adjustment movements on Sibor and the rates on your banks won’t be taking effect so soon, but it’s a good borrowing time if you are buying properties like houses, shophouses or office even as an investment.
The sentiments for US eating into a recession is very strong, but it shouldn’t impact our economy much. Asian countries has came a long way from the 97-98 Asian Crisis and have definitely diversified their nests all around instead of concentrating all its eggs on the US economy. I’ve read even about neighbour Malaysia’s Central Bank, Bank Negara breaking borders on its monetary reserves (at 101.3 Billion US Dollars) being able to survive for even in face of another crisis should one arise.
Much shouldn’t be said for our own Singapore Government being prudent on our reserves and investment overseas. We’re generally sound.