Myanmar banks offer international credit cards

In a boon for holiday shoppers, Myanmar banks are starting to offer customers international credit cards for the first time.

The country has only recently returned to true credit cards, which disappeared in the wake of the 2003 banking crisis.

At the start of this year some 2 million “credit cards” had been issued, but most operated like debit cards – some require funds in an account and others require pre-payment.

But this year has seen the return of true credit cards that allow customers make purchase with no funds or collateral necessary.

Myanmar Oriental Bank, Ayeyarwaddy Bank and CB Bank all offer credit cards, and CB Bank launched an international card last week, according to U Kyaw Lin, vice chair of CB bank.

The card is branded with the Myanmar Payment Union and UnionPay International stamps, allowing it be to used abroad wherever UnionPay is accepted.

Other lenders are following the trend towards offering credit cards for local and international purchases.

Myanmar Oriental Bank is planning to launch an international credit card soon, according to the lender’s chair U Mya Than.

KBZ has offered cards since 2015, but these require funds in a saving account. Daw Swe Zin Win, general manager of KBZ, told The Myanmar Times that her bank hopes to be able to offer the same cards as CB Bank and Ayeyarwaddy Bank soon.

Without a credit bureau in Myanmar many banks have deemed it too risky to issue unsecured cards, as they are unable to accurately assess the creditworthiness of their customers.

CB Bank, Ayeyarwaddy Bank and MOB all link credit card limits to income. U Aung Htet Paing, deputy general manager of MOB’s card department, told The Myanmar Times in March, that Anyone with a monthly salary of more than K150,00 was eligible to apply for cards allowing users to spend between K250,000 and K5 million.

CB Bank offers three types of card depending on a customer’s income. Classic card holders can spend between K500,000 and K1 million. Gold card holders can spent K1 million to K4 million, and Platinum card holders K4 million to K5million.

Banks are careful in scrutinising customers applications. But even so credit cards are a risky business, said U Zay Yar Aung, managing director at CB Bank.

“It takes almost two weeks to analyse an application,” he said, adding that CB Bank will close the accounts of customers that do not settle their bills.

CB Bank customers pay no interest on purchases, but must pay their credit card bills within 45 days, after which they pay 1.08 percent interest on the amount outstanding. Ayeyarwaddy Bank offers the same terms.

 

Source: Myanmar Times

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