Kevin ThompsonOne of the great amenities associated with credit cards is cash advances. You can use your card to take out cash at a local ATM machine. If you are short on cash, this is a great way to make sure you do not come up short on funds when you need to purchase something.
Once credit card in Malaysia offers this convenience to cardholders. It enables card members to withdraw funds from their assigned credit limits and repay the amount in affordable installments each month. The period for repayment may extend from 6 to 36 months. The advantage of this credit card of Malaysia for cash advance is that it helps you manage your cash flow.
Your Credit Card Obligations
Your obligations to the credit card company are simple – you only need to pay each monthly instalment, according to the cash amount and the tenure. Usually, interest charges will not exceed 9% per year. However, taking out a cash advance in this manner is a privilege – one that you should recognise before you withdraw funds.
If you do not fulfil your payment obligations, you may be liable for the following:
- Paying finance charges that range from 15% to 18% per annum. These charges are assessed if you do not pay an outstanding balance before the due date stated on your credit card statement.
- You are usually liable for a late payment charge in the amount of one percent of the balance or RM10, whichever amount is higher.
- The bank can also set off any credit balance that you hold against the card’s outstanding balance.
- Unauthorised transactions are also your responsibility.
In addition, you can be held liable for any minimum payment on which you default for a three-month consecutive period. If you fail to repay the amount you withdrawal in accordance with a credit card’s terms, the bank has the right to terminate the card.
Settling a Balance Early
Now that you know the penalties, you want to make sure you pay off the balance or make the payments, as required. If you do decide to settle the balance before it matures, you will not be penalised.
Also, in the case of early settlement, the interest is only calculated up to the month of settlement. For instance, if you choose a three-year tenure and wish to settle your outstanding month early, or after one year, you can do so. By paying the unbilled amount, you are entitled to an interest refund.
Because this type of cash advance is tied to your credit card, you assume all the risks related to credit card use and non-payment. You also should be aware of the finance charges that are added when you make a minimum payment. Knowing this information is helpful for getting the most value out of your card.
Fullerton
