So, we make money mistakes. Big deal. What matters is what we do to recover and learn from them.
One MoneySmart reader, I will call him Danny, made a credit card mistake in the past enough to put him on banks’ negative list. The misdeed technically was his brother’s, who used his credit card to buy a computer and promised to pay him monthly.
You probably guessed what came next. His brother failed to pay, and the P18,000 debt ballooned to P30,000 within a year. Danny paid everything by 2004, but by that time, his name was already hot listed.
Fast forward four years. Now, Danny feels that after 11 years of financial stability and having paid his debt in full, he deserves the benefits of a credit card. He applied with HSBC, Bank of the Philippine Islands and Banco De Oro but got rejected. He sent an email to the Bangko Sentral ng Pilipinas’ Financial and Consumer Affairs Group, asking about what he can do to clear his name.
With the help of Bangko Sentral Managing Director Johnny Noe Ravalo and FCAG head Elvira Ditching-Lorico, Danny’s case was forwarded to the banks concerned. Turned out that the bank that issued his first credit card failed to update his records even after full payment, that is why his name—up until early November this year—was still on the negative list.
But Danny feels that all’s well that ends well. On November 5, he got his newly minted credit card. He got his name cleared and I’m sure that felt good. Now, don’t go burning that card, Danny, ok? Enjoy your new credit, but be responsible :-).
November 24th, 2008 at 6:19 pm
I don’t know. I used to have a bad credit also with one of the credit card company. I tried paying for it from the issuer but told me to contact the law firm. I talked with the law firm and they kept on harassing me. I dropped the credit and never paid for it. Past forward 5 years after, I tried applying for an HSBC card and I was granted. I couldn’t be more happy in my life.
November 13th, 2008 at 2:02 pm
Danny’s case is not new to credit card issues when applying for it. The bank does not care whether or not he was the one who used it.
Danny should have been responsible in taking care of his name in the bank since the bank doesn’t even know that it wasn’t his fault.
I should say that the market for credit cards is still immature comapred to other countries. It’s funny why there’s a lot of Filipino’s who wants to collect so many credit cards with high credit limit and show it off, spend too much just to sustain their lifestyle yet they don’t have high disposable income.
Always remember this! “DON’T SPEND MORE THAN WHAT YOU EARN”
November 13th, 2008 at 1:37 pm
This is another case of Rule of 72 working against you. Power of compound interest against us comsumers.
November 13th, 2008 at 1:28 pm
parang sa US din yan na “never co-sign for a loan.” dito sa pinas, bawal maki-bum sa credit card.
November 13th, 2008 at 12:17 pm
Hi Paetechie, honestly I still don’t know. I will have to look into the implementing rules of the law. What I am hoping for at least is that individuals will have access to their own records (with stringent requirements in making sure the right person is accessing the records, of course, to avoid identity theft) so that they know whether there is an error and they can correct the record. That’s light years away from the current system where banks are not even required to disclose why a certain person is in the negative list!