How to Know If You Have Bad Credit Card Debt or Not?

Bad debt is one of the challenging issues facing many consumers and borrowers today. When bad debt occurs, individuals may find it difficult to access legitimate borrowing sources, encounter obstacles in job applications (as many organizations require credit history checks) or travel abroad. To minimize the risk of bad debt, the first thing you need to do is to understand and effectively manage your personal finances, with clear financial development strategies. Regularly monitor and evaluate your credit score to understand all related information.

Definition of Bad Credit Card Debt Every Customer Should Know

Bad credit card debt, or what can be understood as difficult-to-repay debt, occurs when cardholders cannot pay their credit card debts on time or only pay a small portion of the minimum amount required by financial companies or banks, leading to this debt being classified as high-risk and irrecoverable.

Once listed as a bad debt customer (according to the classification on the Credit Information Center - CIC), you will encounter many difficulties in borrowing from financial institutions and banks in the future.

Here are some key points about bad credit card debt that you need to understand:

• Overdue payments due to failure to make full payments as required by the due date, causing the debt to start accumulating interest and possibly classified as bad debt.
• Bad credit card debt directly affects your credit score as it is recorded in the credit report at CIC (*) and can significantly impact your credit score.
• Penalty fees and interest rates when bad debt appears are usually high, increasing your total debt amount and making it difficult to repay if you do not have a proper plan.

(*) CIC (Credit Information Center) is a Credit Information Center under the State Bank of Vietnam. CIC is responsible for collecting, storing, analyzing, and providing credit information to serve the management requirements of the state banks.

How to Deal with Bad Credit Card Debt to Avoid Long-term Consequences

Not only a financial issue, but bad credit card debt also has a significant impact on mental health, often seen as a psychological burden for many people. Therefore, you must be proactive and positive in addressing this issue through improving personal financial management, budgeting, and saving. When facing bad debt, you can consider the following:

Clearly identify your current debt and total income, control excessive spending.

Restructure debt by contacting banks or credit card companies to discuss reducing interest rates or changing repayment schedules.

Pay on time when bad debt arises, even if the payment amount is only the minimum to avoid increasing bad debt.

Regularly monitor and evaluate your credit score to quickly plan for improvement, avoiding the accumulation and seriousness of bad debt.

Enhance knowledge to understand more about financial products and services to choose the financial options that are suitable for your goals and repayment capacity.

Choosing THE FIRST credit card from Shinhan Finance offers various payment options and reminders

THE FIRST credit card, a product of Shinhan Finance, is a choice that many customers are interested in due to its characteristics such as:

• Withdraw cash up to 100% of the card limit with only a 1% cash withdrawal fee.
• "Buy now, pay later" with an interest-free period of up to 45 days.
• Flexible installment payment with 0% interest.
• Unlimited reward points accumulation with 0.5% of transaction amount.
• Easily withdraw cash with a virtual card at VPBank transaction counters after successfully issuing the card on iShinhan.

Manage and use flexible card features quickly through the iShinhan app.

In fact, there have been cases where customers inadvertently fell into bad debt due to forgetting payment deadlines. Currently, many banks and financial institutions like Shinhan Finance have implemented credit card management on the iShinhan app, making payment convenient.

Optimal, safe, and easy payment anytime, anywhere through:

• iShinhan mobile app / iShinhan electronic portal.
• E-wallets / electronic portals: MoMo, Payoo, ZaloPay...

Additionally, Shinhan Finance always ensures payment reminders for customers to avoid missed information or payment deadlines through Zalo (ZNS, Viber, Email). You can refer to detailed information above.

Through this article, it is hoped that you have gained useful information to build smart spending plans and effectively manage credit cards to maintain financial stability for yourself.

See more: how to apply for a Shinhan Finance credit card.

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The fastest channels to register for a loan:

• Hotline: 1900 54 54 49 (press 2 – Loan consultation)
• Website Shinhan Finance
• iShinhan financial management application
• Fanpage Shinhan Finance
• Directly at Shinhan Finance transaction counters: See the address details of Shinhan Finance branches.

Sincerely,

Shinhan Finance