More people using ‘plastic cash’ to keep debts in check

Monday January 26, 2009
More people using ‘plastic cash’ to keep debts in check
By YUEN MEIKENG


PETALING JAYA: Debit or credit, sir? This is an increasingly frequent question being asked at local sales counters these days.

With prudence being the order of the day, more Malaysians are turning to using “plastic cash” — or debit cards — to pay for their purchases.

Banks are reporting more applications for debit cards, which are slowly but surely gaining popularity compared to credit cards.

For the Chinese New Year, more shoppers are swiping debit cards to keep their expenditures — and debts — in check.

Compared to credit and charge cards where the cardholder has to pay interest for late payments to the financial institution concerned, purchases with the use of a debit card are deducted direct from the cardholder’s savings account.

Maybank consumer banking head and senior executive vice-president Lim Hong Tat said the number of its debit card users had been growing on an average of 13% every month.

The bank currently has more than seven million debit cardholders, he revealed. Affin Bank head of cards business Phoon Kok Kam said the bank’s debit card users shot up by 70% since May 2008.

“We see a growing trend among customers who are aware of the need to manage their spending,” he added.

RHB Bank consumer product management head Angela Tan said the