We had the privilege of being invited to the launch of Standard Chartered Bank’s credit cards in Ghana. As I’m a Standard Chartered account holder, I honored the invitation.
In case you’re not familiar with what a credit card is, it’s a card that enables you to “buy now, pay later.” Standard Chartered launched two of such cards last week, bringing to bear world class learnings from the Standard Chartered Group (mainly from Asia and the Middle East)
Standard Chartered promises to open a new world of privileges for its clients with the credit cards. The two credit cards – Visa Infinite and Visa Platinum Card – definitely match global credit card standards. They are secure, globally accepted, and promise to offer attractive shopping and travel rewards.
Although credit cards offer convenience (you’re essentially getting access to short term loans) and rewards and loyalty points based on spending, they kind of have a negative association. When I think of credit cards I think of all those Western reality tv shows that document the lives of people crushed by credit card debt and late night TV ads by sketchy looking lawyers who promise to eliminate your credit card debt.
But using a credit card doesn’t necessarily mean going into debt. Although the interest rate for paying back how much you spend is a skyscraper high 41.88%, there’s an interest-free repayment period of up to 50 days. This means if you use your credit card to buy yourself, say, a new sound system at the Accra Mall, you have up to 50 days to repay the amount without having to pay interest. You also get reward points that can be redeemed when shopping and traveling. Of course, this prospect is only attractive and feasible if you’ll have the money for the sound system within 50 days.
What piqued my interest in the credit card was neither the “buy now, pay later” opportunity or the promise of accruing reward points that can be redeemed locally and globally (there was no indication of which organizations were signed on to the rewards program). Instead, it was the prospect of building credit to enable me to access loans and even a mortgage in the future. The reason credit cards are so ubiquitous in the West, in spite of the very real reality of spiraling into debt, is that credit ratings are necessary to have. A credit rating is an evaluation of your “credit risk;” essentially it predicts your ability to pay back your debt, and you can’t even rent an apartment without one.
The Head of Retail Banking at Standard Chartered, Henry Baye, indicated that Standard Chartered and all other banks that issue credit cards are required by the commercial bank to send all credit information for individuals and organizations to the Credit Reference Bureau. The credit information must be sent monthly and is accessible to authorized banks.
Currently it’s difficult as a young adult of average income to successfully apply for a loan or mortgage from a financial institution. Most of us don’t have anywhere near the collateral required, so getting these financial instruments is near impossible. I think and I also hope that Standard Chartered and all the banks that currently offer and will in the future offer credit cards will work towards making credit ratings more useful in Ghana. This way, it would be attractive to use a credit card, spend reasonably, repay the amount spent (within the interest free period), enjoy short term rewards and also increase my chances of enjoying the long term reward of improving my eligibility for a loan or a mortgage based on my credit rating.
If Standard Chartered can truly deliver on its #RewardsForLife credit card promise, I’ll be first in line for one!
The Nitty Gritty Details Visa Infinite – The Travel Card
–Redeem on 800 airlines across the world
-Unlimited airline lounge access -Up to 5x rewards on travel, supermarket fuel, automatic comprehensive travel insurance up to 2.5mUSD (most cards give you 1x rewards). Redeem points from the best rewards program in Africa
Visa Platinum – The Shopping and Dining Card
-3x rewards on supermarket and fuel
-Purchase protection coverage
-Chip and pin for greater security; cannot be cloned
-2 factor authentication online to protect you from fraud
-Advanced transaction monitoring for fraud prevention (FALCON); monitors your payment behavior
-Free transaction notification SMS’s
Receive statement at the end of the month indicating your spend and repayment period.
Access to the Visa Rewards Engine web portal to tracking your number of rewards points. The portal also enables you to redeem points for gifts, tickets, hotel bookings, home appliances, fashion & beauty products
Who is eligible to apply?
Stanchart clients who have regular income. Credit referencing on every client. To apply for the Visa Platinum card, you need to have a net monthly income of 1,000GHS, which Standard Chartered says is the average salary for an entry level job. You will need a net monthly income of 5,000GHS to apply for the Visa Infinite card.