Tip 234: Never pay credit card fees

The credit card market in countries like Hong Kong, Malaysia and Singapore is getting competitive. New foreign banks entering the market is putting intense pressure to incumbent established banks to participate in various incentive giving, contests and constantly motivating their customers to spend.

I had always requested for my credit card annual fees or late fees to be waived and been successful. I have realized there is no exception. No matter what reasons the officers give when they persuade me to pay the charges, they would willingly waive it when they know that I would not accept the fees whatsoever. If I have a good track record of spending, the credit company would relent to absorb any fees if I say I would cancel the cards.

For my Malaysian credit cards, upon knowing that the government is imposing an annual service tax of RM50 in 2010, I cancelled most of my cards and only maintained my Citibank credit card. I told the bank that I would cancel it if they would not absorb the fee. Initially, they would give excuses that the fee is charged by the government and they could not absorb it. When they knew they would lose a customer, RM50 seems like a reasonable amount to pay to keep the customer. So I continued using the card since there is no fee involved, but only rewards gained from using it.

In Singapore, the government does not impose any fees and I have more than a dozen cards with various shopping outlets. AMEX Krisflyer told me that they would be able to waive my annual fees, but not the SGD60 administration fee for converting my points to air mileage every month. The eloquent officer explained that the fees are imposed by the airline company and that this card was the only card that allows me to earn mileage instantly upon spending and that the fees are justified. I spoke with her for 20 minutes but did not want to accept her reasoning and maintained that I would cancel the card considering it is more expensive to maintain this card compared to my other cards. The officer did not want to agree to offer me the waiver either. I told her it has taken too much time and I had to hang up the phone. Later, I checked my statement and the fee was waived. I am probably the only customer in Singapore who did not pay my administration fee and still get to use its benefits.

It may seem unreasonable to ask for so much. Yet, by knowing that you have the bargaining power, then it is pointless to be paying fees when you can avoid it. The opposite can be true in Japan. Rules and law cannot be bend for the customer. When I was beginning to complain about my annual fees, the bank was quick to cancel my card when I was late to pay even once. This would not have happened in any of the other countries above.

(Photos show Haruka acting as a sheep for the nativity play. She was so bold that she was playing with the baby doll in front of everyone on stage).