Thursday, February 23, 2006

A Vicious Cycle

In a society where your credit history determines what sort of services you are entitled to, if any at all, the person, with a stellar credit history back home, but new to this country, will rank as low as a flea. I found this out the hard way.

My application for a home phone line and broadband internet connection was rejected due to my low credit rating. And this is for a service which is not locked into a contract and which the service provider can terminate at any point, if they so deem that I am not a desirable customer. I pointed this out to them and the response was even so, this situation was outside of their credit policy. I sorely wanted to tell them that their credit policy sucked and made no sense. However, I held my tongue because I still want those services and was told that I can reapply with more information to increase my credit rating. So the second time round, I re-positioned myself as a long-term employee who has been relocated from my home country to this wonderful place, and hopefully, this second application meets with their credit criteria and gets approved. At least the guy who dealt with my re-application agreed to record the fact that I hold credit cards even though they were not issued here, the first guy decided that the response to that question was negative and probably degraded my credit rating by a whole lot with that.

A uni mate told me that her application to buy a mobile phone with a pre-paid card was also stringently scrutinised and was told that she had no credit history. The fact that she showed them a hefty bank account statement didn't help. The fact that it's a pre-paid card which means her money is already given to the phone company in advance also didn't help. Another situation which simply reeks of a lack of application of common sense.

Now, if people who come to this country, are denied basic services such as phones, internet, apartments leases, due to the fact that they are new to this country and hence do not have a credit history on file, how are they expected to live here and start establishing some sort of existence, let alone a credit history? If their bank statements, foreign credit cards are not accepted as proof of their credit worthiness, what else can they show? Are foreign banks and credit providers not as reputable as the ones here, that's why these cannot be accepted as evidence of a person's credit worthiness? If so, that is a really myopic view to take.

Protecting one's company from credit risks is a given in the commercial world, but doing so blindly, without any flexibility and common sense, only serves to harm the company's reputation, and in the end, the reputation of that country. Every newcomer will undoubtedly start life here, with a view that this first-world country is so mired in its own overly and blindly regulated bureaucracy that it lacks the pragmatism and common sense to apply these regulations in reality. Since there is no point fighting this, one has to start developing strategies to get around the red tape... and a tip - leave all comparisons of efficiency one is used to back home, at home.


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