“BIG” Deal: MBF Credit Card Balance Transfer Plan
Touted as the best credit card balance transfer plan ever in its teaser ad, on 30th November, MBF credit card finally unveiled it offer in a ‘big’ way – a free 29 inches flatscreen TV for any approved transfer during valid until 1 March 2007.
With the help of the big screen TV, lets look at the terms and conditions stated in its advertisement:
- Minimum transfer is RM5,000. Such minimum amount is easily 5 times of other banks’. The minimum requirement does seem to suggest that MBF is interested in capturing ‘high value’ target customers.
- Maintaining an outstanding balance of RM4,500 for next 12 months. This is something that sounds not so right. Reason, balance transfer is supposed to help one to settle card debt, not prolong it.
Here comes the interesting fine prints: If your balance dips below the RM4,500 balance during the next 12 months, you will be charged RM1,000 by MBF credit, a 22% penalty! But this is not all, during the 12 months period, you balance will be slapped a monthly interest of 1.5%, which is the same rate as any credit card outstanding balance at 18% p.a. So where is the balance transfer! For sure, MBF’s balance transfer is different from the rest. Instead of offering any special promotion rate, MBF chooses to thrown in a big screen TV. In a simpler form, it is special rate vs free gift.
Conclusion
OK, no special low interest rate, but at least, you get a 29” flatscreen TV, aren’t you? At 1.5% per months, the total interest paid at the end of the 12 months is RM810 (Based on RM4,500 minimum outstanding balance requirement). Add in the RM50 processing fee, your total balance transfer cost is RM860.00. The same brand and similar model sold in Harvey Norman Ikano center costs RM899.00.
With the RM1,000 penalty should the outstanding amount drops below RM4,500 in next 12 months, and that you are charged an 18% p.a., for the RM4,500. It is beyond doubt that MBF wants you for life - to carry the credit card debt till your death.
Enjoy your “free” big screen TV.
Review date: 4 December 2006