The Story of the “Over Limit Fee”

I woke up one morning with bills all over my desk. So I told myself what’s new? Little did I know that there will be something new when I open my Metrobank credit card bill. My card limit is PhP 20,000.00 a month and my bill reached PhP 20,400.13. In other words, I exceeded my limit by PhP 400.13. Guess what? Metrobank charged me with a PhP 500.00 over limit fee as penalty.

I can’t help but laugh in disbelief. I looked at my bill again and it says I paid my April bill of PhP 19,915.13, but unfortunately one April transaction was not included which amounted to PhP 485.00. And I think if I am not mistaken that transaction made me exceed my limit of PhP 20,000.00, that is why I am being charged over limit fee of PhP 500.00.

Now why do I find this transaction funny but with disbelief. Metrobank is one of the country’s most if not the most reputable banking institution in the country today, perhaps even one of the most stable banks. So being one of the biggest, reputable and stable banks, I expect their I.T. infrastructure – hardware and software included to be world-class, state of the art no less. It should be effective, efficient and secure as well.

Everytime I use my credit card, the card will be swiped for the purpose of recording the transaction and I am assuming that it checks whether I have exceeded my limit or not. This is a security feature that should be present in every credit card system because a credit card holder (like me) don’t keep track of my credit card spending. I will just use it till the cashier would inform me that “Sir, you’re card was rejected”. That is the only time that I will be aware that I have spent more than what I am allowed to spend.

Also, this is a security feature and a protection for the bank as well so that a customer (legitimate or not) cannot spend more than its allowable limit or more than what he/she is capable of paying. I believe this is what credit investigation is all about – to check the capacity to pay of a particular credit card applicant. The credit card company gave me a PhP 20,000.00 limit because based on their credit investigation, I am only capable of paying PhP 20,000.00 a month. This is a feature that will benefit both the bank and the user. The limit controls the spending of the user and the bank limits the exposure to PhP 20,000.00 for someone who can only pay that amount per month.

So to be charged with an over limit fee is ridiculous. How would I know that I exceeded my limit when the banks Credit Card Swipe Machines (CCSM) approved of the transaction? What the CCSM should have done is to reject the transaction and inform the user that he/she already exceeded the limit. Now I refused to believe that this is a way for the bank to earn more from its customers – what is PhP 500.00 to Metrobank?

I would understand if the bank charges interests or even penalty charges for late payments or non-payments, but an over limit fee? Unbelievable. I believe the bank should even be thankful that I exceeded my limit but still manages to pay my bill in full. Can I also charge Metrobank a late-to-bill fee for the late billing of PhP 485.00?

I am writing this article for two reasons – to warn other credit card users about this fee and to let Metrobank (and other banks for that matter) to check on the security features of their system. You don’t want your system to be compared to a Precinct Count Optical Scan (PCOS) machines right? Your prime existence in this business is INTEGRITY – nothing else. So go fix it.

What will be my course of action – ask Metrobank to increase my limit to PhP 20,500.00. 🙂

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