We Sold One Of Those Blank Cheques That Came In Our Mail – Here's What went down
From time to time, we might receive blank cheques from our banks within our letterboxes. In Singapore, we've been brought up to be really cynical whenever we're offered something free of charge – especially money. Upon closer inspection of those blank cheques, we would quickly realise that they are simply marketing tools, looking to get us to consider much more of their services – namely, a credit card balance transfer.
Further down within the article, you will see that we used DBS because the example. This is only because it was the blank cheque that came in recently and was surprisingly quite useful. We've received blank cheques from other banks previously, and searching at online chatter, it would appear that other banks in Singapore employ this online marketing strategy.
Is This A moral Practice?
Our close friend at Budget Babe called into question, with an article she wrote, the ethics behind this marketing tactic.
There are really two facets of ethics to consider: 1) could it be the best product VS a scam? and a pair of) could it be being marketed in a fair way.
The first area of the question is quite clear to reply to. These blank cheques are marketing a legitimate and, oftentimes, extremely useful product called charge card balance transfer promotions. It's not even close to a gimmick.
The second aspect of the question is less straightforward – could it be marketed in a fair way? For somebody who is younger or the financially savvy, there should be no question that many people would be conscious of what we're engaging in – especially if we got money we do not own from a lender in our mailboxes.
It's also hard to suppose our banks are deliberately targeting older or illiterate people. First and foremost, we're fairly confident that our financial institutions fail to work in such an unethical or prejudicial method.
More importantly, this is simply a form of targeted marketing, and usually based on data in our credit usage and/ or worthiness, rather than financial literacy. It is also quite fair to assume that individuals, both young or older, would be financially-savvy and acquainted with banking practices if they're already utilising several banking products.
In the off chance a mature or illiterate person receives such blank cheques, we're certain that growing up in Singapore might have made this person extremely guarded to receiving free money, especially in form of an empty cheque.
Arguably, the older generation might be much more vigilant about tracking every cent they own, spend and could be receiving. As well as, also they are very apprehensive when encountering anything new or foreign (think internet or mobile banking), and will most likely ask family members or friends if they are unsure relating to this blank cheque.
Yes, these blank cheques really are a curious thing to receive within our mail. However, we believe many people would view it for what it is – the marketing of the product.
We Banked Within our Cheque So You'd Know What Really Happens
If you've ever wondered what would happen if you banked in a single of those cheques, we made it happen so you do not have to continue guessing.
Firstly, here's the blank cheque and accompanying letter one we received in our mail. It's pretty straightforward: alerting us that this method is credit cards balance transfer product, in addition to depicting the interest rate (and effective rate of interest) we must pay when we choose to proceed with the credit card balance transfer.
Having read the lengthy conditions and terms, we proceeded to complete the details and deposited the cheque in our account. Particularly, we had to consider these T&Cs more carefully:
# 1 Have a credit card balance transfer of $500 or even more;
# 2 Ensure we do not write a sum that exceeds our borrowing limit (this means understanding how much we've spent in addition to taking fees/ charges into consideration on the particular credit card that we are using for the balance transfer);
# 3 Observe that we have to pay a minimum of 3% in our charge card balance transfer amount each month;
# 4 Note that we have to settle the whole amount within 12 months to avoid getting charged the prevailing rates (which is currently close to 25% per year)
Our borrowing limit was stated as $6,000. So, we veered on the safe side by writing an inspection for
