Written by Siti Sakinah Abdul Latif
Thursday, 17 December 2009 19:32


KUALA LUMPUR: MALAYAN BANKING BHD [] will not be absorbing the RM50 credit-card service tax as doing so would run counter to the objective of the measure's introduction under Budget 2010, says the bank's CEO Datuk Seri Abdul Wahid Omar.

He said the government had introduced the tax to ensure the public would not be overburdened by high credit levels as the household debt in this region was relatively high.

"We must observe the spirit of the introduction of the RM50 tax in the first place, which is why the bank will not absorb the cost," Wahid said at a signing ceremony between Maybank and MoneyTree (M) Sdn Bhd earlier today, for the sponsorship of a year-long financial-literacy programme for youngsters.

The government had introduced a RM50 service tax for principal card holders and RM25 for supplementary card holders under Budget 2010.

Wahid said consumers were likely to lower the number of credit cards they signed up for due to the service tax.

He added that Maybank had a credit-card loyalty programme and the points collected could be used to offset the RM50 tax.

Wahid said Maybank was also aggressively promoting its debit cards as an alternative to credit cards among it customers.

Asked if the bank was seeing any reduction in the number of credit-card holders, Lim Hong Tat, Maybank's head of consumer banking said, "Not much reduction has been seen." He added that it was "still within control" and that the impact would become clearer in the next few months.

Lim said Maybank would have two million Visa debit-card holders in the next one or two months, with 101 million transaction per month, while its credit-card base had reached 1.6 million users.

Meanwhile, on Maybank and MoneyTree's collaboration, Wahid said the financial-literacy programme would benefit 25,000 youngsters in universities and schools.

MoneyTree chairman Datuk Nik Kamaruddin Ismail said the company would begin to educate youngster between six and 20 years old on financial literacy and skills to manage personal finances, in January.

http://www.theedgemalaysia.com/business-ne...ervice-tax.html