~J~ SPOREANS WILL SINK INTO FURTHER CREDIT CARD DEBT OF MORE THAN $10 BILLION BY THIS CHRISTMAS [photo credit: The Straits Times] Singaporeans are sinking further and further into debt. As at October this year, outstanding credit card loans reached $9.98 billion. This is a 72 percent increase from $5.8 billion in the October of 2009. As December is the period where consumers are most likely to use their credit cards, this is expected to balloon over $10 billion. Things have gotten so bad that banks had to write off $225 million by in the first 10 months of this year, as compared to $152.9 million over the same period in 2009. This is an increase of nearly 50 percent. Rollover balances, or bills that are not fully paid, have risen to $5.4 billion, increasing by more than 50 percent since 2009. As of October this year, there were almost 1.58 million credit card users, according to the Credit Bureau (Singapore) And almost 540,000 people were not paying their bills fully. This makes up about a third of credit cardholders. Also, 47,000 or 3 percent of cardholders have debts which are more than their annual salaries. However, people The Straits Times spoke to did not seem to think that this is a major issue. Spending more is not the same as overspending, Credit Counselling Singapore president Kuo How Nam said. He also said that the proportion of credit card holders who have been unable to pay their bills fully, and the bad debts which were written off as a proportion of rollover balance has remained stable, which he said is a big relief. Dr Siriwan Chutikamoltham, senior lecturer and director of banking and finance at Nanyang Business School at Nanyang Technological University, also did not think that the rising credit card debt is a problem. However, last month, a Jobstreet report showed that 46 percent of Singaporeans holding executive positions said that they earn enough only to spend on essentials and are not able to save. 45 percent also said that they were saddled in debt from property, car and credit card loans. Only 5 percent of Singaporean executives were able to save. It looks like it could be a case that even middle-income Singaporeans are not earning enough to survive in Singapore. And the increasing credit card debt is only a sign of things to come.
Posted on: Tue, 16 Dec 2014 13:32:45 +0000