Citibank to charge HK credit card holders almost 50% interest
Last night, while watching CNN, I was shocked to see that Citibank Hong Kong is charging its credit card holders almost 50% interest rate. According to Citibank, the interest rate is applicable to Citibank credit card holders who miss their cash advance payments.
It appears that in December 2008, Citibank announced that 44.73% will be imposed on cash advance customers who fail to make their first payments and 49.86% for those missing their second payments.
Because of the backlash and protests, Citibank issued another statement recently, stating that effective March 2009, it is lowering the rate to below 45% for customers, “whether they’ve missed the first, second or third payments” for cash advances (see full story).
As it is, the current interest rate in the Philippines for credit card holders is pegged between 24% to 42%, depending on what card you’re using. But still, the interest rate imposed by Citibank Hong Kong is enough to make you faint.
I somehow have the feeling that because the US government bailed out Citibank, it needs to make more money to pay the government. And one way of paying back is to jack up the interest rates for its credit card holders.
I wonder if Citibank Philippines will follow suit.. What do you think?