Credit Card Perceptions in Thailand?

[hellohello123]

have a friend who ive known for a little while, comes from a well off family, educated, spent a fair bit of time abroad, well travelled, Smart, very switched on

 

we recently got on the topic of credit cards, and I realised there was a lot of references to getting credit cards as soon as she her job is confirmed with a reputable company, and how banks are not giving them out as easy as they used to be, and rich people having them.

 

she previously had credit cards and used them it was like free money and bought designer bags, cosmetics and got into trouble but she cut them up and continual reference to "it was HER decision to cut them up", and she doesnt have financial education

 

In my country even 18yr students on flipping burgers part time can get credit cards (with low limits), my first credit card was when i was 18 at uni, with a tiny limit

 

Is it thai culture to see credit cards as a sign of wealth?

 

ive explained to her in my country, virtually every one who wants one can get one, having multiple credit cards is not a sign of wealth and often is the opposite

 

Common in the western world too but she didnt seem to understand that a credit card is not free money

 

I told her I have more than one credit card, and I continually got asked "why havent you spent all of it?"

 

 

[Kwasaki]

8 minutes ago, hellohello123 said:

Common in the western world too but she didnt seem to understand that a credit card is not free money

 

I told her I have more than one credit card, and I continually got asked "why havent you spent all of it?"

I don't know how Credit Cards work in Thailand, are given to Thais against property they have as security or what. 

 

I was to believe it's run the same as money in the bank if you haven't got money you cannot spend it because they don't do overdrafts or do they. 

[foreverlomsak]

I'm going to be told I'm wrong, but this is my understanding

In the UK a Credit Card has an available balance you can spend of their money, whereas a debit card uses your money in your account to generate the available balance.

In Thailand both appear to work the same way, the available balance is dependent on how much you have in the associated account (i.e. you can only spend your money).

[hellohello123]

8 minutes ago, foreverlomsak said:

I'm going to be told I'm wrong, but this is my understanding

In the UK a Credit Card has an available balance you can spend of their money, whereas a debit card uses your money in your account to generate the available balance.

In Thailand both appear to work the same way, the available balance is dependent on how much you have in the associated account (i.e. you can only spend your money).

In my country  that's the same too.

Credit cards have been around for ever and the bank gives you a limit  of "their" money and you have credit/assets/income checks, and you get charged interest

 

Whilst debit cards are newer, and have the same mastercard/Visa  logo on it but it's tied to your savings account and requires no credit checks and you can only spend what you have, so a 8 year old could have one  so there is zero chance of getting into financially difficulty

Edited September 2, 2022 by hellohello123

[foreverlomsak]

1 minute ago, hellohello123 said:

you can only spend what you have

Debit cards are the best way to go imho.

Credit cards are dangerous, if you don't keep in mind you need to pay them off eventually!

[Kwasaki]

23 minutes ago, foreverlomsak said:

I'm going to be told I'm wrong, but this is my understanding

In the UK a Credit Card has an available balance you can spend of their money, whereas a debit card uses your money in your account to generate the available balance.

In Thailand both appear to work the same way, the available balance is dependent on how much you have in the associated account (i.e. you can only spend your money).

That's how I believe it to work in Thailand. ????

[Etaoin Shrdlu]

28 minutes ago, foreverlomsak said:

I'm going to be told I'm wrong, but this is my understanding

In the UK a Credit Card has an available balance you can spend of their money, whereas a debit card uses your money in your account to generate the available balance.

In Thailand both appear to work the same way, the available balance is dependent on how much you have in the associated account (i.e. you can only spend your money).

The Visa credit card that I have, which is issued by a major Thai bank, has a stated credit limit that is not connected in any way with the amount of funds I have available in my account.

[soi3eddie]

My ex-wife had a Thai credit card in year 2000 just before I met her. A "friend" of hers asked to borrow 20,000 Baht which she drew as a cash advance to lend to the friend. Surprise, surprise the so called friend never paid her back and disappeared. About 6 years later the debt collectors caught up with the ex on a visit to Thailand (we were then living in the UK) and we settled at a discount as by then she had acquired land.

 

From how I see it; the Thais beleive that if anyone (banks or friends or family) has money to lend then they clearly don't need it and it never needs to be repaid. This could be why it is now quite difficult to get a credit card in Thailand (although a friendly bank manager can pull strings).

 

 

[FriendlyFarang]

Credit cards in Thailand work the same way as probably anywhere else. Don't confuse credit cards with debit cards.

A credit card has a certain limit, set by the bank, depending on how much income you have, and maybe credit history etc.

This is money you can borrow from the bank, and if you use it for purchases you have a certain time frame (usually 1 month, sometimes 2 months) where you don't pay interest rate on it. If at the end of this one month you pay your credit card issuing bank in full it's done, no interest due. If after this month you don't have the money, you can do a payment plan instead, in this case interest is charged. If you do a cash advance at an ATM (and not a purchase in a store), interest starts to accumulate as soon as you withdraw the money.

The most basic requirement to obtain a credit card in Thailand (as a Thai citizen), is to have an income of 15k Baht (the bank wants to see income payment slips over a certain amount of time). If a Thai can provide these slips it's usually no problem for them to obtain a credit card, often the limit is also quite high, so they might get a 100k limit with their 15k/month job, and might even be able to obtain multiple cards at different banks.

 

Neither me, nor most Thais would consider 15k Baht per month as wealthy, so I guess it's not seen as a sign of wealth.

Edited September 2, 2022 by FriendlyFarang

[JimmyJ]

"I told her I have more than one credit card, and I continually got asked 'why havent you spent all of it?' "

 

Put a ring on it.

She's a keeper.

[jayboy]

1 hour ago, Etaoin Shrdlu said:

The Visa credit card that I have, which is issued by a major Thai bank, has a stated credit limit that is not connected in any way with the amount of funds I have available in my account.

That's also true in my case and I should imagine most financially stable residents, whether Thai or expatriate.

[Cardano]

There is only one type of credit card available in Thailand and that is one that allows you to borrow money (credit) from Visa, MasterCard, Amex etc. up to an authorised credit limit irrespective of what bank funds you have. All other cards issued via Thai banks are debit cards irrespective of whether it states debit or credit card on them.

[HappyExpat57]

Before the days of credit cards, life was slower, smaller, friendlier. You went to your local grocer, got your goods on a tab which you paid at the end of the month. In those days a simple savings account earned 6% compound interest.

 

Enter corporate greed. Tempt young people with a large chunk of money that appears as free money. Only a fraction of the balance needs to be paid monthly. Ignore the fact that most of that payment is interest and that it would take seven years of minimum monthly payments to pay off the balance. Want another credit card? No problem, you can use THAT one to make the payments on the FIRST one.  Soon you're giving the banks hundreds of dollars every month in interest payments alone. And thus began the financial enslavement of millions of people.

 

If you use a credit card, use it like the first paragraph of this post - pay off the balance every month.

[Chongalulu]

10 minutes ago, HappyExpat57 said:

Before the days of credit cards, life was slower, smaller, friendlier. You went to your local grocer, got your goods on a tab which you paid at the end of the month. In those days a simple savings account earned 6% compound interest.

 

Enter corporate greed. Tempt young people with a large chunk of money that appears as free money. Only a fraction of the balance needs to be paid monthly. Ignore the fact that most of that payment is interest and that it would take seven years of minimum monthly payments to pay off the balance. Want another credit card? No problem, you can use THAT one to make the payments on the FIRST one.  Soon you're giving the banks hundreds of dollars every month in interest payments alone. And thus began the financial enslavement of millions of people.

 

If you use a credit card, use it like the first paragraph of this post - pay off the balance every month.

There are much more sophisticated ways to use credit cards to your advantage these days as cheap loans (U.K.) interest free balance transfers . You can do an almost eternal loop with them . I’ve had well over a decade of practically free money which is invested in my SIPP /ISA which have given much greater returns than the tiny amount of occasional fees. 

[Richard 2020]

2 hours ago, Cardano said:

There is only one type of credit card available in Thailand and that is one that allows you to borrow money (credit) from Visa, MasterCard, Amex etc. up to an authorised credit limit irrespective of what bank funds you have. All other cards issued via Thai banks are debit cards irrespective of whether it states debit or credit card on them.

That's not quite right....

 

As a FARANG without verifiable income, so without a work permit they usually get No credit card in Thailand!

 

But there is another way for pensioners in Thailand, which I also went!

 

You have to open a FIX account with any deposit!

 

I have 200.000.-THB deposited on it! Up to this amount I can pay with my Mastercart credit card!

 

The charges are then debited monthly from your "savings account"!

 

So there must be money in that amount too!!!

 

The FIX ACC. will not be debited! It is only the bank as security and is also blocked!

 

That is, you can also not withdraw money from this FIX Acc.!

[Cardano]

3 minutes ago, Richard 2020 said:

That's not quite right....

 

As a FARANG without verifiable income, so without a work permit they usually get No credit card in Thailand!

 

But there is another way for pensioners in Thailand, which I also went!

 

You have to open a FIX account with any deposit!

 

I have 200.000.-THB deposited on it! Up to this amount I can pay with my Mastercart credit card!

 

The charges are then debited monthly from your "savings account"!

 

So there must be money in that amount too!!!

 

The FIX ACC. will not be debited! It is only the bank as security and is also blocked!

 

That is, you can also not withdraw money from this FIX Acc.!

Sorry but you are completely wrong, what you have explained above is that you are actually giving the bank 200,000 baht on deposit (for which the bank will earn interest from). You can then use the bank issued card to borrow your own money up to the amount on deposit, if you fail to pay the monthly charges the bank will take them from your deposited amount, subsequently reducing the balance on deposit and the card limit. There is no benefit to you using this system as all you are doing is borrowing your own money whilst the bank uses your deposit balance to earn interest. Just use your debit card it's basically the same thing.  

[sandyf]

49 minutes ago, HappyExpat57 said:

Before the days of credit cards, life was slower, smaller, friendlier.

Obviously getting on in years to make that comment.

In the early days you had to be 21 to get a credit card, I got my first, a Barclaycard, the week after my 21st birthday in 1968.

I believe the first recognised credit card was Diners Club in early 50s.

[Richard 2020]

27 minutes ago, Cardano said:

Sorry but you are completely wrong, what you have explained above is that you are actually giving the bank 200,000 baht on deposit (for which the bank will earn interest from). You can then use the bank issued card to borrow your own money up to the amount on deposit, if you fail to pay the monthly charges the bank will take them from your deposited amount, subsequently reducing the balance on deposit and the card limit. There is no benefit to you using this system as all you are doing is borrowing your own money whilst the bank uses your deposit balance to earn interest. Just use your debit card it's basically the same thing.  

But, I have some advantages ...

 

There should be, even today, stores that just do not accept a debit card!

 

Also as a security, for example, upon admission to a hospital, after an accident, this credit card can be charged!

 

This does not work with a DEBIT CARD!   With a debit card, the money is transferred immediately!

With a credit card just not! 

It is only the sum "Blocked" and serves only as security.

Likewise with the rented car ..etc"!

[sandyf]

4 hours ago, foreverlomsak said:

Debit cards are the best way to go imho.

Credit cards are dangerous, if you don't keep in mind you need to pay them off eventually!

Pros and cons both ways. With a debit card the funds are removed from your account immediately and it can be very difficult to get those funds back in the event of a problem.

With a credit card there is much more security around the transaction.

You are quite right in the fact that credit cards do require a certain amount of self disipline and that has become a major concern in the UK. It is feared that many will resort to using credit cards to pay energy bills this winter and then run into problems with repayments.

[peterfranks]

36 minutes ago, Cardano said:

Sorry but you are completely wrong, what you have explained above is that you are actually giving the bank 200,000 baht on deposit (for which the bank will earn interest from)

You are the one that is wrong, because it is the depositor who earns the interest on the fixed account.

[peterfranks]

8 minutes ago, sandyf said:

You are quite right in the fact that credit cards do require a certain amount of self disipline and that has become a major concern in the UK.

Maybe different in the UK, but where I come from, I have had a credit card for decades, and my bank account was setup to automatically pay the monthly credit card statements before the due date

[sandyf]

2 minutes ago, peterfranks said:

Maybe different in the UK, but where I come from, I have had a credit card for decades, and my bank account was setup to automatically pay the monthly credit card statements before the due date

Are you trying to say that paying off the credit card balance every month was a compulsary condition for getting the card?

If it is a voluntary arrangement then that is nothing more than an act of self disipline.

[peterfranks]

3 minutes ago, sandyf said:

Are you trying to say that paying off the credit card balance every month was a compulsary condition for getting the card?

If it is a voluntary arrangement then that is nothing more than an act of self disipline.

No, i said that I had set up my account to automatically pay the received statements on due date.

 

Of course, that only can happen if there is a balance in the account.

 

[Cardano]

5 minutes ago, Richard 2020 said:

But, I have some advantages ...

 

There should be, even today, stores that just do not accept a debit card!

 

Also as a security, for example, upon admission to a hospital, after an accident, this credit card can be charged!

 

This does not work with a DEBIT CARD!   With a debit card, the money is transferred immediately!

With a credit card just not! 

It is only the sum "Blocked" and serves only as security.

Likewise with the rented car ..etc"!

You don't have any advantages you are just being conned into using your own money in exchange for a card that the bank claims is a credit card but whatever way you cut it there is no 3rd party credit facility applicable to your card, you are the credit facility. Your'e bank is treating you as a child who cannot be trusted to manage their own finances.
As for your list of so called advantages;
I do not know any stores that will accept credit card and not debit card, but even if perchance they do exist then just use your phone banking app or do bank transfer.
Hospitals readily accept debit card and bank transfer.
As for sum "blocked" only come across this at hotels and it's quite easy to just pay cash deposit as amount is insignificant.
Car rental will accept deposit via bank transfer and do reverse transfer when you return car, takes a couple of minutes at most.

You may think I am being a bit of a <deleted> here, but on the contrary I am just trying to make you realise that you have been conned in to a prepaid so called credit card with no credit facility. Do you not have a credit card from your country of origin which can be used for security deposits and in case of emergencies?


 

[dundas]

I prefer to use a debit card, but I carry a credit card just in case.  

 

On a recent Thai Airways flight, for example, one individual was trying to buy a seat with extra leg-room, but was refused because 'we don't accept debit cards, it's not like buying something at the mall.' So he had to get to know his knees better down the back.

 

Probably the airline has difficulty verifying payment while in flight so they take the obvious option ... and only accept credit cards. 

[Cardano]

27 minutes ago, peterfranks said:

You are the one that is wrong, because it is the depositor who earns the interest on the fixed account.

Learn how banks work before making silly statements, banks do not give money away, they use deposited funds to lend to 3rd parties from which they generate interest (profit) of which they will give the depositor a small percentage of said interest.

[peterfranks]

2 minutes ago, Cardano said:

Learn how banks work before making silly statements, banks do not give money away, they use deposited funds to lend to 3rd parties from which they generate interest (profit) of which they will give the depositor a small percentage of said interest.

Maybe YOU should engage the brain.

 

You suggest using debit card instead of credit card.

 

With a debit card the money also has to be deposited in the account. otherwise the card will not work.

 

One of the differences is that with the debit card the money has to be in a current account, earning 0% interest, while with the credit card the money is in a fixed account, earning a certain amount of interest.

 

Another benefit of the credit card is that you earn cash backs and points, each time you use it, which you can use to buy other things. Not an option with a debit card

[peterfranks]

1 hour ago, Cardano said:

Sorry but you are completely wrong, what you have explained above is that you are actually giving the bank 200,000 baht on deposit (for which the bank will earn interest from). You can then use the bank issued card to borrow your own money up to the amount on deposit, if you fail to pay the monthly charges the bank will take them from your deposited amount, subsequently reducing the balance on deposit and the card limit. There is no benefit to you using this system as all you are doing is borrowing your own money whilst the bank uses your deposit balance to earn interest. Just use your debit card it's basically the same thing.  

Stop talking about things you don't have the slightest knowledge.

 

Foreigners who legally work in Thailand can get a credit card without having money locked up in an account.

[StevieAus]

4 hours ago, Cardano said:

There is only one type of credit card available in Thailand and that is one that allows you to borrow money (credit) from Visa, MasterCard, Amex etc. up to an authorised credit limit irrespective of what bank funds you have. All other cards issued via Thai banks are debit cards irrespective of whether it states debit or credit card on them.

That is not strictly true as some banks such as the Bangkok Bank will not allow an expat who is not working , to have a credit card unless the amount of the  credit limit is maintained in a separate bank account.

No deductions are made from that account so it is not a debit card.

[Cardano]

11 minutes ago, peterfranks said:

Maybe YOU should engage the brain.

 

You suggest using debit card instead of credit card.

 

With a debit card the money also has to be deposited in the account. otherwise the card will not work.

 

One of the differences is that with the debit card the money has to be in a current account, earning 0% interest, while with the credit card the money is in a fixed account, earning a certain amount of interest.

 

Another benefit of the credit card is that you earn cash backs and points, each time you use it, which you can use to buy other things. Not an option with a debit card

My brain is fully engaged thanks and it tells me you don't understand the definition of "credit"  Having to deposit X amount in a FD account is a security requirement of the bank to enable them to issue a card that allows you to spend your money up to the amount deposited, how is this credit?. Also note that the interest is only payable after your total deposit is locked for a set time period, any withdrawal will result in loss of interest. As for cashback and points just another marketing con. Also I didn't suggest using anything, I stated that the so called credit card issued by the OPs bank is not a credit card it is a just a debit card that allows a certain time period before any debit to your current account, there is no credit facility, he has to deposit his own funds to enable use of so called card (same as debit card).