Missed payment is a sign of financial strain

FNB's Credit Card Division advised consumers not to miss any credit card payments.
"The first sign that indicates that consumers are currently debt stretched includes defaulting on any credit payments, including credit card repayments," FNB's Credit Card Division said in a statement.
"Any form of a missed payment on a credit card raises concern for the bank," head of credit risk Darryl Lahner said.
"It is under this circumstance that the bank considers protecting both the customer and the bank by reducing a customer's credit limit."
Lahner said regular missed payments were a clear indicator that a customer might be under financial strain.
"It is important for customers to realize that the bank monitors missed payments regularly."
"These are not limited to credit card repayments, but include any form of missed payment on any of the other banking products," he said.
Lahner stressed that consumers should not view a credit limit reduction as a form of punishment from the bank.
"Rather, the bank is acting as a responsible lender, by preventing customers from falling deeper into debt."
Bank's statistics revealed that fewer customers defaulted on their payments once their credit card limit was reduced. "Initially customers are not happy, however most customers end up thanking the bank for the lifeline as it helps in protecting their credit bureaux profile," Lahner said.
The bank advised customers via SMS about any credit limit reductions.
"Customers would receive the communication early in the day avoiding any form of embarrassment at point of sale before using their cards," he said.
Customers were also encouraged to approach the bank should they need a credit card limit increase.
"The bank is willing to share and reassess with the customer concrete reasons considered leading to the credit limit reduction or increase."
He explained that if consumers were planning an overseas trip, they could ask for a temporary higher credit limit.
Some consumers might want to limit their exposure to possible fraud by decreasing their credit limit, he said.