Have you ever had a credit card that you either want to pay off or simply try and pay your monthly instalments just to find your card suspended and your name placed on ITC?
The financial institutions want you to pay the instalment amount they ask you each month. If you pay more than this amount it is fine but don’t think that you can use the additional payment of this month to compensate next month’s instalment. The large corporate financial institutions system can’t work that way. Even if you pay more into your account over a period of months than you are supposed to pay, the financial institutions will not accept this if you miss a month. You will be branded a nonpayer.
Don’t think you can explain this to the call centre operator. If you work for a salary there is no problem to pay this amount at the same time every month, but when you work for yourself or get irregular income like commission or contract workers it is not always possible to pay at the same time. Take for instance a property agent. They only get paid once the property has been registered and sometimes there are hick ups that prolong the registration process.
You would think that financial institutions would take this into account, but wait the financial institutions have no idea how the real world works, only how to make money with other people’s money. Let us not burst their bubble. We don’t want millions of homeless people on the streets that can’t survive out here in the real world.
Now we can speculate for hours why the bank does this. Personally I think the longer you take to pay your credit card the more interest the bank earns seeing that credit cards has some of the highest interest rates.
The best way of getting past this is to pay only the monthly instalment required by the bank and pay the additional funds into a savings account for times when you can’t pay the instalment. When the amount in your savings account reaches the outstanding balance of your credit card you can pay it off.
The above applies to any instalment account you may have, whether it is a clothing account or paying off some furniture. Luckily businesses are a bit more lenient and understanding.