Ambassador to UAE does not use credit cards...
Indian Ambassador to the UAE T P Seetharaman’s departing note cites personal debt as major issue for Indians
The Indian Ambassador to the UAE TP Seetharaman is saying good bye to the Indian community here and to the Indian Foreign Service, from August 31, 2016, after the completion of 36 years.
Seetharaman has advised the Indian diaspora especially in the UAE and Gulf region to rethink their addiction to a luxurious lifestyle using borrowed money, especially huge loans beyond their means of repayment and multiple credit cards.
The Ambassador himself said he does not use a credit card and only uses a debit card.
“My earnest advise to the Indian community is to be aware of uncontrolled personal debt, especially from multiple credit cards and they should be aware of the consequences.
“If a Dh2,500 per month salary earner is taking a loan of Dh 300,000 and three or four credit cards together, his ability to pay back is limited. They should be aware of the problems of uncontrolled debt,” the outgoing Ambassador said.
“When such people come to the embassy seeking help, we cannot do anything for them,” the Ambassador said.
Wise advice indeed
It is baneful. It simply removes the natural thinking powers of matching your expenses with your income. Once the powers to purchase whatever is desired is in a person's hands, there are simply no controls. Human desires are unlimited. Credit Card takes care of this.
Why can't a two-dollar grocery bill get paid through a debit card as is done here and many other countries?
Elsewhere in US and Europe, you will use credit card to pay even two dollars of grocery bill.
Virtually it has become a strong alternative to the CASH (Currency), which is why billions of transactions are happening through it, world wide.
Before the popularity of Credit Card, the travelers have to rely on the "Travelers Cheques", which the CC has eliminated altogether.
The students and new generations are fond of CC, and may the older people could avoid it, but the teens with their unsurmounting desires, are in no position to hold back.
Credit card is an essential yet an international "Instrument of Credit.
It has the ability to cross all the boundaries, and it can become your most important fall back companion if you are out of money and away from your home.
There is no fault with the "CC" rather it has loosely with the spending disciplines of an individual.
By advising the public to avoid CC, the Ambassador Seetharaman is annoying, yet another Seetharaman of Doha Bank (CEO), who is also a most visible face of India in Qatar and the Gulf. This Seetharaman has been instrumental in allowing credit including the CC on highly flexible terms and on a large scale.
acchabaccha:
"Seetharaman has advised the Indian diaspora especially in the UAE and Gulf region to rethink their addiction to a luxurious lifestyle using borrowed money, especially huge loans beyond their means of repayment and multiple credit cards."
Sirs: The topic was on the usefulness of "credit cards." Here we have now diverted to discussion on loans being offered by banks, how they are calculated based on DSRs and when to take a loan.
A credit card is a totally different thing. It directly flouts the laws of economics allowing a consumer to buy more than his income. It is something that is for benefit of the sellers and the banks, and nothing but that. It is a tool that allows a person to easily become a debtor within seconds. It has very little use to people who are calculate their expenses keeping it within their incomes. .
I salute the Indian Ambassador to the UAE Mr TP Seetharaman for giving such a valuable piece of advice that is to stay away from credit cards. The advice was not just to his own nationals but to others as well while presenting himself as a role model.
WT,
So, you mean "Cash is King, and, Credit is Beggar".
This isn't a "burning" topic. I always pay cash, and you have to pay me cash for my service. And if I marry it's always the first time.
Tractor can generate more money but 2nd marriage can't.
Brit, thank you for picking up the right and burning topic, which is related to almost everyone around us.
Most to the defaults happen due to bad spending habits of the borrowers, who tend to borrow and then waste away the money in just a few shots on many unproductive or loss making deals.
This acts as a complete trap for them.
The ideal rule is to "Borrow only if you can use the loan money to Create More Money".
But temptation is something that MM and many others are unable to desist, so in line with that, the borrower would often borrow the sum for buying tractor, but then ending up spending the loan money on the 2nd marriage.
Equinox: Great response and clarification.
I believe the issue is more to do with culture. Many expats, especially from developing nations take out a loan with a view to buying land, building a house, marriage, treatment of a loved one etc.
This is in addition to having to send money home for family care and emergencies.
They don't realise that we are all "temporary".. Jobs can go at a moment's notice and then they are left to repay the loans at short notice.
MM's experience of receiving night calls for free money is something that a few could hardly desist.
The banks sell their products and while doing so, they essentially evaluate each and every loan proposal on the key default risk parameter of "Debt Service Ratio or DSR".
They put together your total borrowings along with your monthly installments, and then divide it by your salary, thus reaching out to a DSR, thereby pre -knowing about your ability to repay the new loan.
So if you have a DSR of less than 50%, the bank is highly ready to approve your loan request or vice versa. The bankers always book a "calculated risk" and they know it that someone with a salary of Qar. 10 000 and an existing DSR of 50% (i.e. existing installment of Qar. 5,000 per month of previous loan), cannot afford to repay the new loan installment, and soon he would default.
Because as a general rule, each borrower needs ATLEAST 50% of income to cater to his personal and family expenses.
Of course there is a gulf of difference between the Ambassador and Molten Metal. That is why he is an Ambassador. The Ambassador talks sense and is always a guide to his nationals ..... not a misguide on a daily basis!
It is the job of banks to lend money. Borrow if you can repay, otherwise dont.
Harry, Only saints can be safe in this world of temptations ............. What would a tired bachelor would do if some body with an enticing voice calls every night at the same time & asks you to take free money , take free money ...... ??
You cannot blame others for your own mistakes. Banks are selling a product .. No one is forcing you to buy ..
The Ambassador has given good advice
Brit, Bank assumes you are capable, your relatives spoil your finances specially the WIFE or GFs.....
MM: Why should the embassy help if a person gets himself into trouble by getting a loan he cannot afford to pay back..
I agree that the banks must take some blame, but it is up to us to be wary.
Brit , Stop Back Biting .................. It's a kind of ABUSE ............
Muad, You are not an ambassador .......... my pal ......
We must all be careful. Don't take money you cannot pay back my pals
Has Riyal2Rupee already logged off :O(
It's sad to know when people won't get support from the said office .......... !
People fall in the trap when they get phone calls in the middle of the night-s .............
So, he did not mention the real culprit the BANKERS ...... !
His statement is similar to a politician.
Same here , no cards at all.
This is great advice.. Too many cases of expats getting loans and overextending themselves