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Credit, where credit is due?

Credit, where credit is due?

A new innovative mall-wide zero-interest credit scheme from Lamcy Plaza and Emriates NBD has Kipp concerned...

April 10, 2012 4:03 by

A year or two back, Kipp watched a ridiculously funny video entitled “10 reasons we are in a financial crisis.” The video featured 10 ads for home loans and credit cards. Of course, being satirical, the ads were terribly farcical. Our favorite included a giant teddy bear swimming on a carpet searching for land…erm, you probably had to watch it to appreciate it. But the point was made very well indeed: the financial mess we are in has a lot to do with the irresponsible, almost reckless promises financial institutions offered credit-crazy clients.

But that was pre-crisis. Now we are neck deep in it, studies have shown a greater resistance from consumers to buy on credit and, consequently, greater restrictions facing financial institutions wanting to offer ‘too-good-to-be-true’ credit schemes. So much so that, as we reported earlier this year, some local banks now require proof of a salary ofDh10,000-plus before issuing a credit card. This limit may seem reasonable, but Kipp remembers all too well those days when credit card sales men would literally go from door to door handing out those dangerous pieces of plastic, as if they were mere business cards.

It is these all-too-clear memories that sees us just a little alarmed by the new link-up between Lamcy Plaza and Emirates NBD. According to a recent report in  Gulf News, the new ‘buy now, pay later’ scheme allows customers to buy on credit at zero per cent interest. The scheme, which has to involve a minimum transaction of Dh300, is applicable to a variety of stores in the mall, including the hypermarket, food court and the play area –marking the first mall-wide tie up for Emirates NBD.

Tim Jones, CEO of Lamcy Plaza, said: “Customers don’t have to wait long for a purchase, plus it facilitates spend across large denomination items, such as electronics, gold and jewellery, watches, perfumes, etc. Shoppers at the hypermarket don’t have to wait for their month-end salary. And equal installments [paid over a certain period of time] will be easier on the purse. An expensive suit, a leather jacket or even a perfume could be purchased with this facility.”

Ahem. Well, so much for living within one’s means, thinks Kipp. We thought the days of ‘innovative’ credit schemes were behind us. Guess we were wrong.

Word of caution dear Kippers, if it seems too good to be true, it probably is.

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1 Comment

  1. Auth on July 27, 2012 11:03 pm

    What do you think? Are we going too far? Is there a faster and betetr way to answer these questions? Do you know of any research that already exists on these issues (for these charities)?It’s one thing to encourage feedback. It’s another to have a research effort so flawed that it requires a massive public intervention. If you want this to be a public effort, make it a public effort. Provide us with some incentive to do your work for you. Make a wiki, say, so we feel like we own the contributions we make instead of like we’re feeding a parasitic host. And lose the 65k/yr babysitters if we’re the ones you want doing the heavy lifting – deciding your whole methodology. Same goes for branding: if this is going to be a community instead of a private concern, it’s got to be represented differently. What I want you to do is lose the whiz-kid branding, the corporate facade, and make this place a user-driven public resource, spurred by the same curiosity that made the kids start this up in the first place.That’s a pipe dream, though. I expect business as usual.


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