CHENNAI: This one is for credit card holders, especially those among the plastic card users who wish to know about their rights and duties, and also to highlight the violation of the `fair practice code' by credit card operators.

An informative website www.creditcardvictims.org has been floated by the Centre for Social and Economic Justice. The objective is to act as a platform to receive complaints and safeguard the interests of credit card users. According to the centre, the 1.5 crore credit card population in India collectively spent about Rs.33,000 crore in 2005.

The use of `plastic money' has been further fuelled by the Railways and other government undertakings, which encourage people to use online reservation and trade, said P. Sundararajan, legal advisor of the centre.

Maintaining that a large number of complaints, relating to the marketing of cards and collection of dues, were received by the centre, he said that there was a vast variation in the interest rate prescribed by various banks. While some nationalised banks restricted the rate to between 20 and 24 per cent, foreign banks and desi commercial banks levied about 36 per cent interest.

Most banks outsourced marketing and collection works to private firms, he said, and added that maximum complaints pertained to the methods adopted by these `collection agents' to recover default amounts. In this regard, he points out that the Master Circular on Credit Card Operations of Banks issued by the Reserve Bank of India (RBI) specifically stated that the principal banks were responsible for the activities of the agency engaged to collect the dues.

The circular says that the banks must first assess the buying power of the purchaser before sanctioning the card, and that the calculation of interest/penal interest should be explained to him with at least two examples. Ruling against any hidden charges, the circular says bills for each purchase must be sent to the consumer well in advance so as to enable him to repay the amount within the interest-free period.

More importantly, the circular says the collection operation should be conducted in a completely "civil manner", and that the principal bank would be liable for the activities of the firm to which the collection works were outsourced. It asks the banks to constitute in-house consumer grievance redressal cells, and empowers the ombudsman for banking operations to act as an appellate authority.

According to Mr. Sundararajan, a large number of complaints were received regarding the high-handed attitude of collection agents, unsolicited hike in credit ceiling, freezing or transfer of funds from savings bank account without authorisation, money demand even after full and final settlement of dues, and unexplained calculation of penal interest rate.

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