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Moolah
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Posting #1: Thu Dec 27th, 2007 08:42 |
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Do you fancy of getting a credit card that offers 5% rebate on shell petrol and 1.5% rebate on other purchases?
If your answer is yes, then you are draining your money away!
The newly launched Shell Citibank credit card is not as good as its sounds - to enjoy the rebate, you must have a carry forward balance. Yes, a carry forward balance that you have to pay Citibank 18% interest per annum. But that’s is not all, your so called ‘rebate’ is based on your current month spending. That means if you have a carry forward of RM10,000 but did not use the card at all for the current month, you get ‘zero’ rebate.
To be precise, this ‘rebate’ card is an old card - it has been around for about 2 years. But now taking advantage of the fuel cost concern, Citibank co-branded it with Shell.
This is how the rebate scheme works:
- First, you need to have a carry forward balance. The amount of that carry forward determines the rebate rate (%) that the card holder is getting.
- Then based on your current month spend, you will get the rebate (as shown by the rebate table above) - your rebate is not based on your total carry forward balance. Repeat: your rebate is not based on your total carry forward balance, but current month spending
In short, to get your ‘rebate’ you must have at least of RM2,000 outstanding balance in you card AND continue use the card. The outstanding balance is the net of previous month balance minus current month payment. If you do that, every month you will be paying RM30.00, or RM360 a year for the minimum RM2,000 outstanding balance.
Let’s do a simple math here:
If you spend RM500/mth on shell petrol and your classic card has a RM2,000 outstanding balance, at 1.5%, you are getting RM7.50 as ‘rebate’, while at the same time, paying RM30.00 for the interest. The ‘nett’ profit for Citibank is RMRM22.50. Your are essentially “over paying” 4 times the price (30/7.5)
To ‘break even’ (so that your RM30.00 interest payment = rebate value), you need to pump RM2,000 shell petrol a month, or charge RM6,000 a month for non-shell related purchases.
The USD100.00 per barrel of crude oil won’t kills you, but the Citi-Shell card will.
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Moolah
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Posting #2: Thu Dec 27th, 2007 08:43 |
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The earlier post on Shell-Citibank cash rebate credit card generated the most comment ever received by this blog, but I am not happy at all!
Most of the comments mistakenly point out that the post made a mistake - that one still enjoys cash rebate even WITHOUT ANY OUTSTANDING BALANCE! Some of the comments even quoted the Citibank website caculator to illustrate the point and conveniently forgot that the main function of the bank’s calculator is just another selling tool.
The comments also reflect how poorly we are in terms of “Financial Savvy” and how easy we take things on the face value.
Let’s go straight to the heart of the debate : “Does the cash rebate only valid with outstanding balance?”
Below is the statement copied directly from Citibank website. Please read it carefully!
“Your cash rebate is calculated based on your outstanding balance from the previous month; less payment in current statement and total spend for the subsequent month.”
First, this statment was not mentioned at all from 10 over calls I made to Citibank while researching for the earlier post. Secondly, not only the call center (mainly a 3rd party sales force engage by Citibank) does not mentioned this statement, it appeared that it did not knows that this statement exists! Question, why the call center is poorly trained?
Back to the statement, it is clear that the rebate is only “given” when your card carries any outstanding balance. So the outstanding balance is a pre-requisite for any cash rebate. Only then come with the rebate tier - the higher your outstanding balance, the higher ‘rebate’ you are getting. And of course you already know that your are paying 18% p.a for the outstanding balance.
Shell-citibank cash rebate card, anyone?
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Moolah
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Posting #3: Thu Dec 27th, 2007 08:44 |
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| ooops... source: http://smartconsumerbanking.com/
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random
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Posting #4: Thu Dec 27th, 2007 08:48 |
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| LOL I received this in e-mail
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on2920
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Posting #5: Fri Dec 28th, 2007 19:14 |
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Hi Moolah,
To be 'fair' to readers and Citi too, the comments below the updated article should be read in whole (not just the snippet posted above), http://smartconsumerbanking.com/2007/12/20/shell-citibank-credit-card-cash-rebate-question-rebuke/
Citi has updated their website but the article has not been corrected.
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Moolah
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Posting #6: Sat Dec 29th, 2007 02:44 |
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Hi on,
Many thanks for the update.
I, for one, believes that the fault lies within their Marketing.
Let me give you a brand new example. http://www.citibank.com.my/APPS/portal/genericLoadPage.do?tabNo=1&htmlPageName=/promo/det/online_estatement.htm#eb
Now, Citi has a brand new campaign. Free 888 points if the user signs up for their paperless statements, ie statements via email.
Here is a screen shot of it...
Doesn't this looks like a 100% gimmee thingee?
Now, the point is, not everyone will qualify for it!
Catch is their term and conditions as stated here. http://www.citibank.com.my/APPS/portal/genericLoadPage.do?tabNo=1&htmlPageName=/promo/sub_det/online_estatement_tnc.htm
Program Period
1. This Citibank Berhad ("Citibank") "Citibank Electronic Statement" Promotion ("Promotion") will run from 1 October 2007 to 31 December 2007 (both dates inclusive) ("Promotion Period").
Eligibility
2. Subject to clause 3 below, all principal Citibank credit cardholders except for Citibank Cash Back and Citibank Ready Cash credit cardholders, who are residents of Malaysia and who have not previously enrolled to receive Electronic Statements are eligible to participate in this Promotion. ("Eligible Customers").
3. The following persons are NOT eligible to participate in this Promotion:
(a) Permanent and/or contract employees of Citibank (including its subsidiaries and related companies);
(b) Holder(s) of Citibank credit card(s) not issued in Malaysia;
(c) Holder(s) of Citibank credit card(s) who is (are), in default of facilities granted by Citibank at any time during the Promotion Period, subject to Citibank's discretion.
The Promotion
4. Eligible Customers who enrol for the Promotion:- (a) via the Citibank Online Website at url address http://www.citibank.com.my (“Citibank Online”) by submitting an e-mail enrolment form; or
(b) via other channels including but not limited to sending a short messaging service text (“SMS”), fax, post and electronic mail;
shall be entitled to participate in this Promotion.
5. All Eligible Customers who successfully enroll to receive Electronic Statements during the Promotion Period (save for Eligible Customers who enrolled for the Promotion via the Citibank Online Website)will be entitled to receive a total 50 Rewards Points from the first month of their receipt of the Electronic Statements until 31 December 2008.
6. Eligible Customers who have successfully enrolled to receive Electronic Statements via the Citibank Online Website will receive a one-time total offer of 888 Reward Points.
7. Reward Points earned upon enrolment will be credited to the Eligible Customer's relevant account within the first fourteen (14) days of the relevant months. For the avoidance of doubt, the Reward Points are also known as AA Points for Citibank AirAsia credit cardholders.
8. Where an Eligible Customer is in possession of more than one (1) Citibank credit card including the Citibank AirAsia credit card, the Reward Points/AA Points will be credited to the Eligible Customer's Citibank AirAsia Credit Card.
9. Where an Eligible Customer has successfully enrolled to receive Electronic Statements for a particular account, his/her other accounts that are linked to that account will be automatically enrolled to receive Electronic Statements.
10. Each Eligible Customer who successfully enrolls to receive Electronic Statements during the Promotion Period will only be entitled to receive a total of 50 Reward Points every month until 31 December 2008 even if he or she has more than one (1) Citibank credit card and/or account.
11. Reward Points earned are not exchangeable for cash, credit or kind and have no monetary value. Eligible Customers are not allowed to transfer or sell their Reward Points to any other person.
12. In the event that Reward Points are awarded to and received by persons who: (a) are not Eligible Customers in the Promotion; and/or,
(b) have committed or are suspected of committing any fraudulent or wrongful acts in relation to use of their Citibank credit card(s) and/or any transactions made thereof;
Citibank reserves the right to disqualify such persons from participating in the Promotion and/or from redeeming or using the Reward Points.
Miscellaneous
13. Citibank shall not be liable for any default in respect of the Promotion due to any act of God, war, riot, strike, lockout, industrial action, fire, flood, drought, storm or any event beyond the reasonable control of Citibank.
14. Citibank's decisions on all matters relating to the Promotion, including the determination of Eligible Customers will be final and binding and no further correspondence or attempts to dispute such decisions will be entertained.
15. Citibank reserves the right to cancel, terminate or suspend the Promotion without any prior notice. For the avoidance of doubt, cancellation, termination or suspension by Citibank of the Promotion shall not entitle the Eligible Customers to any claim or compensation against Citibank for any and all loss or damage suffered of incurred by the Eligible Customer as a direct and indirect of the act of cancellation, termination or suspension.
16. Citibank reserves the right at its absolute discretion to vary, delete or add to any of these Terms and Conditions from time to time without prior notice.
17. To the fullest extent permitted by law, in no event will Citibank or any of its officers, servants, employees, representatives and/or agents (including without limitation, any third party service providers that Citibank may engage for purposes of the Promotion) be liable for any loss or damages (including without limitation, loss of income, profits or goodwill or indirect, incidental, consequential, exemplary, punitive or special damages of any party including third parties) howsoever arising whether in contract, tort, negligence or otherwise in connection with the Promotion, even if Citibank has been advised of the possibility of such damages in advance, and all such damages are expressly excluded.
18. By participating in the Promotion, Eligible Customers agree to be bound by these Terms and Conditions and any decisions of Citibank, and the Eligible Customers hereby give their consent to and authorise Citibank to disclose their particulars to third party service providers engaged by Citibank for the purposes of this Promotion, if any. Citibank warrants that the disclosure of such particulars to any third party service providers, if any, shall be limited to the Eligible Customer's name, address and telephone number and shall be used only in relation to and for the purposes of this Promotion.
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lesson from this?
The consumer needs to read ALL the fine prints...
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on2920
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Posting #7: Mon Dec 31st, 2007 17:17 |
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He he, Thanks, I fully agree, thou nowadays All services (mobile phone, Astro, etc etc) has many many T&C, even if Malaysia is not as litigous as US yet for e.g.
Similar to investment products (strutured products OTC), let the buyer beware. :P
Unless we want standard agreements and terms for all products like for e.g. standard SPA for residential homes, published and approved prospectus like for unit trusts, etc.
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