Frugal Living

One of the many obvious and effective marketing and selling scheme continuously used by department stores, electronic shops and appliance centers is baiting customers into buying their wares through installment payments. Credit card companies’ logos and supposed “easy installment plans” usually lures customers into buying things that they simply couldn’t afford.

Yes, if you cannot afford to pay for anything in cash and in full, and you have to make monthly payments for some items, it simply mean you cannot afford it right now.

I know alot of people who one way or the other had have horrifying experiences with credit card companies. Years ago, when I was still carrying a Citibank Credit Card, I have had experience when I was charged 6 times for a magazine subscription– Oprah magazine in fact. After receiving the credit card bill, I quickly noticed the numerous times I was charged, I quickly called their hotline number and the CSR told me to file a dispute claim by downloading a dispute form from the website of Citibank and fax the form along with the statement of account. Needless to say, Citibank quickly remedied the problem and they credited the other transactions and I was only charged once for the annual subscription of Oprah Magazine.

While it’s not always possible to avoid credit card disputes, here are some more tips for dealing with them:

•Get promises in writing. Save receipts for big charges. Also ask for written confirmation of when the item will be delivered and what services are provided as part of the purchase.

•Know the rules. The Fair Credit Billing Act gives consumers the right to dispute a credit card purchase or withhold payment for a card purchase – but only under certain conditions.

Disputes must generally be filed in writing within 30 days after the bill is sent. While disputing a charge, the card holder will not have to pay the contested amount and won’t incur interest on it. If the dispute is lost, the card company is allowed to charge interest back to the date you filed the dispute, after a standard grace period.

•File the dispute carefully. Banks classify card holders’ disputes into nearly two dozen categories, such as “merchandise not received” or “canceled recurring transaction” (just like what happened to my Oprah Magazine subscription), but generally, if filed as an “unauthorized transaction” – as long as it is unauthorized – you’ll have more protection.

•Be prepared to arbitrate. Most disputes are settled between the merchant and the consumer. But your credit card issuer could also try to resolve it with the merchant’s bank. If that doesn’t work, the final step often is arbitration, where the issue is decided by Visa or MasterCard.

It’s rare for cases to go to arbitration: At Visa, only one-tenth of 1% of disputes are decided in arbitration, spokeswoman Randa Ghnaim says.

Credit card disputes can last up to 270 days, including the arbitration process, although 99% of card disputes are settled much sooner, says Monteiro of MasterCard.

•File a complaint elsewhere. If you feel that your dispute hasn’t been fairly decided, file a complaint with the Department of Trade and Industry. You can check the SOP in filing a complaint, here. Filing a lawsuit is also an option.

Ofcourse, nobody wants to be bothered with credit card irregularities and there are alot of ways in avoiding this kind of problems. But here are things you should be aware of:

• Be careful of divulging your credit card information. Do not give out your information over the phone or the internet.
• Be aware of phising scams in the internet.
• If possible, be present while the cashier is swiping your card into their machines. Ensure that your card is only swiped once. You do not want double or triple charges into your account.
• Keep all receipts of every transactions until your statement arrives and you have double checked each transaction.

If this article bothered you so much, heck, you can always get rid of those cards and switch to debit cards! Here is my take on the advantages of credit cards.