United Bank Limited (UBL) has slapped Rs 50 monthly fee on the subscription of the SMS alert service for its customers using credit cards of various ranges. The charges will be effective from January 1st of 2015 along with additional FED as per the prevailing schedule of charges.
The new charges spell into Rs 600 yearly in addition to the annual charges, which are in thousands of rupees.
SMS alert services have been introduced in line with the growing trend in the banking industry.
Customers of various banks avail this information based service to keep themselves updated about transactions, credit acquired and bank’s reminders to customers related to payment deadline. Besides this, alerts include transactions made on both basic and supplementary credit cards as well as fraudulent transaction on your card if any.
The SMS alert service is not activated by default; rather, customers do it manually although they are encouraged to avail the service since it provides instant notification on card usage across the world. Though it could be observed that in Pakistan, mostly the services are imposed on customers without their consent which is illegal and considered as an unethical business practice.
UBL categorizes various credit cards including Silver, Gold and Platinum with annual fee varies from Rs 2,000, Rs 4,000 and Rs6,000 which is provided with insurance coverage. However, the bank charges additional fee which vary from Rs 500, Rs 750 and Rs 1,000 on these cards and they are billed as chip maintenance fee for security. Altogether, a customer with basic Credit Card has to bear Rs 3,100 fee annually.
Banks are increasingly imposing new charges instead of providing complimentary services to the customers which are already giving them heavy rent on credit which varies from 25 to 30 percent annually on the amount utilized.
Besides this, there are certain amount of service fees charged by every bank at times of clearance of the amount from the customers.
With more of the population going online, banks should be offering services for free, not introducing new charges. If the trend continues, more banks will follow suit for SMS alerts and similar services. This could discourage the growth of plastic cards in the country and the entire industry could suffer as a result.