Having a credit card is nowadays sort of a must. You get good deals, lots of freebies, and it buys you almost 2 months of time to pay up for something you're already using. Especially if you follow your cut-off by heart.
Discounts from shops, a free extra dish or dessert from restos, free bags, flash drives, caps, shirts and the like from appliance shops, and the biggest perk of all, are the 0% interest promos.
Years ago, credit card usage was charged an additional 4-6% of the purchase price. Because that's how the bank/credit card company earned from that purchase. The surcharge was a turn off for a lot of shoppers, and it also meant a loss in sales for those establishments.
Years after, more and more people are getting credit cards, and the 0% interest schemes started, where you can opt to purchase a rather expensive item such as an appliance or gadget, in 3, 6, 12 and 24 month installments, at 0% interest.
Appliance fairs were put together in most malls, where all 0% participating merchants display their wares, from refrigerators, microwave ovens, TVs, sound systems, computers, and even furniture.
I actually know of friends who watched out for those fairs because they didn't happen often.
Now almost all establishments with electronics and gadgets offer the 0% scheme. I gotta admit, it is so much more enticing to buy something expensive in installment, than paying in cash. One, it's easier on the pocket, it gives you time to save up for the next bill, and two, the dent in your savings will also be in installments, instead of a huge chunk gone.
However, some establishments still refuse to offer the 0% plan. They either offer cash purchases, or straight payment/deferred charge to your credit card. While the deferred one still buys you time, it's still not as light as the 0% plans.
Why don't they offer it? This is because it takes like 2 weeks or even more for the bank/credit card company to pay the merchant back. And it's in cheque. So there. But still, other establishments understand that they lose a lot of business if other stores offer it, and they don't.
And then there are also the establishments who offer cash purchases or 0% interest but with a mark-up. Say that again?
Say the iPod sells for P15,000 cash. So if it's offered in 0% interest for 12 months, that's just P1250/month right? Wrong. These other establishments will let you buy the item for "0% interest" for 12 months, but at P17,000 already. Does that even make any sense?
I often argue with the salespeople at these stores, because they insist that IS 0% interest.
Duh! The reason why it's called 0% interest is because you pay the same amount in cash. If you can't afford YET to pay in cash, then go 0%. That's what it's for. Apparently, to them it's bad enough to wait for the bank to pay them for a credit card purchase, worse to wait for the bank to pay them in installments, so why not mark-up on the purchase to make it worth the wait?
I swear, I have been in numerous establishments all over Manila who offer this screwed up version of the 0% interest plan. Particularly in Cyberzones, in Greenhills and in smaller stores.
Shops such as Abenson, Electroworld, SM Appliance Center, and Anson's all have the REAL 0% interest scheme. That's where everyone should go. There's a reason why these shops are still around. And this is one of them.
I think that consumers shouldn't tolerate this. These establishments shouldn't take advantage of the 0% scheme. If they can't deal with the scheme, then why offer it?
Everyone shouldn't give these stores any business. So that they will be forced to either offer the real thing, or just don't offer it at all. Unless you don't mind the extra P3,000, then go right ahead.
If you know or chance upon any establishment who operates like this, you may report them to the Credit Card Association of the Philippines (CCAP) at 688-1888. Take note of the establishment name and location.
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