Penalty charges
I had [taken] a personal loan from Citibank and I [paid off] the instalments in January, 2010. However, to my surprise, I received a call in March from Citibank informing me that I have a penalty — late payment charges — and they will hold my security cheque.
As far as I know, personal loans do not have penalty charges for late payment, since I have also [taken] a personal loan from another bank and they were not charging me anything. Only from December, 2009, this other bank informed me that there would be a penalty for late payment, so I always made sure that I paid on time.
Taking into consideration that I took the loan in 2006 and from that time I have never been aware or informed that there would be penalty charges for late payment, I was confident that the bank would deduct the payment from my account automatically. Thus, I did not bother to pay it on time since my salary comes to the same account.
Citibank should have informed me when I was delaying the payment, since they have a collection department, that there is a penalty. They should also have charged me in the same month [as the delayed payment] so I would be aware that there is a penalty.
How could I avoid the late payment penalty if I am not aware [of it]? It is like you are convicting an innocent person. It wasn't my intention to delay the payment. If I knew of the penalty, I could retain some money in my account just to pay on time. Also, the penalty charges were not included or reflected in my bank statement.
As customers, we have the right to know what the bank is charging and what the customers are paying — that is why there is a bank statement. Citibank should properly inform their customers of the penalty and not only remind or ask them regarding the payment.
I would like to raise this issue with Citibank and request them to take a look into this matter as it is unfair for me to pay the extra charges.
From Ms Rubelita Supan
Dubai
The management of Citibank responds:
We have been in contact with the customer and the matter has been resolved to her satisfaction.
Ms Supan had taken a personal loan in December, 2005 for 48 months which matured in December, 2009. Her salary was being credited in the account that had been opened to facilitate the Estimated Monthly Instalments (EMI). On several occasions, this account was not sufficiently funded to ensure that the EMI could be deducted on the due date which resulted in late fees being charged.
When Ms Supan approached the Collections Unit to release her security check, she was informed of the accrued charges. We have contacted Ms Supan on multiple occasions and advised her that the Terms and Conditions governing the loan agreement clearly indicate that late fees will be applied if the EMI is not received by the due date. As a service gesture, we have reversed Dh380 from the total of Dh1,045 that she owes us. She has agreed to pay the remaining amount in two instalments over the next two months. We would like to take this opportunity to thank Gulf News and the customer for providing us with feedback and regret the inconvenience caused.
Ms Supan responds:
I would like to thank Gulf News for helping me raise my concern and prompt action. However, I would like to contest the response from Citibank, which is one sided.
Firstly the matter has not been resolved to my satisfaction. I am left with no choice but to pay Dh665 since they withheld my security cheque. My worry is that they can use that to file a case against me.
Citibank is providing misleading information. Please note that I did not approach Citibank to collect my security cheque. They called and threatened me that they would hold my security cheque if I did not settle the charges.
I would like to reiterate that Citibank never informed me about [the late fees] and even when I applied for the loan they never gave me a chance to review their terms and conditions. Even their salesperson did not highlight it. If I knew about the penalty charges, I may have been able to avoid them. Citibank only informed me about it in March, when my loan [instalments] were complete. I request Citibank to review their records of conversation.
The management of Citibank responds:
We have again contacted Ms Supan on the concerns raised by her. Ms Supan was explained to in detail on the Terms and Conditions of the loan. She has agreed to pay the remaining amount after two weeks. Since Ms Supan has expressed her inability to pay the total late charges on the loan due to some personal circumstances, we have offered to waive part of the outstanding as soon as she is able to clear the agreed amount.
Ms Supan responds:
I would like to reiterate to Citibank that the contention here is due to the lack of their transparency and it is not due to the inability to pay. I hope that Citibank will understand their customer's concern that it is very difficult to release money for something that you are unaware of. I agreed to pay Citibank an amount of Dh332 as soon as my salary is transferred to the bank.
I requested them on November 10 to deduct the same from my account, but till date it hasn't been done. I do not want to argue any further, since they do not want to understand the issue. My previous letters are already self-explanatory and I rest my case.
The management of Citibank responds:
We wish to inform you that we have debited Ms Supan's account with the agreed upon amount on November 21, 2010 and the remaining outstanding balance has been waived off as a service gesture.
We would again like to reiterate our thanks to Gulf News and the customer for providing us with feedback.
Editor's note: If you have similar consumer complaints, raise them with us at: readers@gulfnews.com
