q : Many people are using credut cards to run up huge personal debts that they may be unable to repay. It should therefore be made more difficult for individuals to borrow large amount of money.
Give your opinion.
The need for money is everlasting. Introduction of credit have accelerated the debt rate of a person, which many find it hard to replay. The argument put forth is, more stringent rules should be framed for borrowing money. In my opinion, it is correct to have such thrifty rules in lending money for the betterment of an individual.
First of all, in most of the banks, credit card limits are set based on the annual income of the person. For example, if a person earns 600,000 per annum, the amount set on the credit cards will be 100,000 per month. However, the authorities of these banks should make sure that the person repays the amount borrowed for a month in few days, before lending him the money for the next month. This will help in reducing the debt of an individual.
Secondly, many banks, in order to attract customers, offer credit cards to the children of an individual. Credit card usage is an addiction. Making children getting used to this habit might even make them financially handicap in the future. Thus, bank officials should limit their credit card supplies to children, which will in turn limit the debt of their parents.
Opponents of these stringent rules might argue that, these rules will not fit for emergency situations such as sudden medical conditions. In such cases, the banks can always reserve cash for exigent purpose. This will definitely not add up the loan of a person, siting these extreme conditions as excuse.
To conclude, stringent rules should always be imposed on borrowing money through credit cards and this will definitely reduce the financial burden of the common man.