Latest survey findings of bank charges on low balance accounts
The Consumer Council has surveyed25 banks on their practice relating to fees and charges and interest rates forlow balance accounts.
The latest survey provides timely and comprehensive information to assist consumers in particular small depositors in their choice of banking service. Highlights of the survey include:
First, 8 out of the 25 banks surveyed have introduced minimum balance requirement and monthly service fee for such accounts.
Banks vary from one another on this practice. In most cases, the minimum balance requirement is between $3,000and $5,000 and the monthly service fee for accounts falling below the minimum balance is mostly from $25 to $50.
In one case, the requirement for minimum balance is a high $30,000 but this encompasses the customer's total accounts with the bank on deposits, credit cards and investment services,mortgages and loans, etc.
Second, 12 of the 25 banks have introduced multi-tier interest rate structures offering increased rates for deposit accounts with higher balances and reduced rates for lower amounts. This will affect the small depositors too.
Depending on the actual amount of the deposit, if the interest rate is reduced by 1%, a small depositor will receive for every $1,000 deposit $10 less a year.
Depositors who do not wish to have their interest rates reduced will need to maintain a balance of, depending on the bank, at least $1,000 to $10,000.
Third, not all banks have introduced minimum balance requirement and/or reduced interest rates for low balance. In fact, among the 25 banks 10 have not adopted either practice.
While some individual banks have indicated that they have no intention to follow the practice, the vast majority of them are currently reviewing their policy on fees and charges and will take into account of the situation in the market before any decision is made.
The Consumer Council has the following advice to consumers:
Review and consolidate your bank accounts by closing those accounts that are not frequently used. This will help raise your account balances and avoid service fees and reduced interest rates.
If you are unable to do so,consider switching to accounts which have no minimum balance requirement or altogether to another bank. Consumers should note that banks with a smaller number of branches are also linked to the Jetco network of over 1,600 ATMs throughout the territory and Macau.
Automation of banking service can offer great convenience to many a consumer. If you are unfamiliar with it, start learning without delay to acquire the skill. This will save you fees charged for counter services.
The Council reiterated its views that interest rate liberalization provides banks flexibility in devising their own business strategies. Competition amongst banks may come in many forms, e.g.higher interest rate or nil/low service fees.
It would be desirable for banks to heed public sentiments expressed over social exclusion of certain groups from basic banking service. In addition, banks should provide the necessary assistance and guidance to customers unfamiliar with the use of automated banking service, e.g. the installation of ATM simulator for hands-on training for consumers.
Full results of the survey were published in a special leaflet (in pdf format - 1.90MB) distributed with this April issue of CHOICE anda re available also at the Council's Consumer Advice Centres and its website http://www.consumer.org.hk.
Some electric extension units are still a safety hazard
Some electric extension units in the market were found not entirely satisfactory in some safety aspects though they did not pose imminent hazards.
The result was unveiled in alatest test conducted by the Electrical and Mechanical Services Department(EMSD) on 17 models of such electric accessories commonly in use in many households here.
It also prompted the suppliers totake immediate improvement actions and to re-certify their products.
The test models are all fitted with 13A plugs, 12 of them with only 13A sockets (rectangular holes) while there maining 5 with both 13A and 5A sockets (round holes).
Findings of the EMSD test,published in this April issue of CHOICE, indicated that 4 out of the 17 models scored totally satisfactory results in all safety test items while one additional model needed improvement in its marking and instructions.
Nonetheless, all other models passed the major test items, notably, provision for earthing, insulation resistance, electric strength, mechanical strength and resistance to ageing and humidity, etc.
Non-compliance was found mainly in the safety requirements related to protection against access to live parts and construction:
- In 4 models, the "test pin" (1mm radius) could contact the live parts when inserted into the earth hole. This finding is worrying in view of the dangerous practice by some consumers who, in order to insert a 2-pin plug into the socket, would use an object to force open the shutters of the earth hole. The object might contact the live parts, and it might pose a potential risk of electric shock to the user.
- In 3 models, the live parts may be contacted when the fuse is in a replacement position. So, always unplug the extension unit before replacing the fuse.
- The electric contact between the "test plug" and the socket in 4 models was found to be unsatisfactory.
- Further, the connection of the flexible cord in 5 models was not sufficiently secured while the durability of 3 models needed to be improved.
Consumers are strongly advised never to overload an extension unit. Besides overloading, it is advisable never to use extension units to supply electricity to high wattage appliances such as air conditioners, microwave ovens, space heaters, etc
Small traces of heavy metals, pesticide residues in ginseng products but no cause for undue concern
A Consumer Council test has detected traces of heavy metals - arsenic, lead, cadmium and mercury - or pesticide residues in a wide variety of prepackaged ginseng products.
But there is no cause for consumers to be unduly concerned as the amount of contaminants in these samples is small. Further, none of the samples, according to the test, were in breach of the safety limits set by the World Health Organisation (WHO) or the Department of Health here.
Nonetheless, the Consumer Council is of the view that the presence of any contaminant in any quantity in a food product is undesirable and traders should, in their own interest, ensure that their ginseng products are not contaminated.
In fact, among the 31 samples (11 instant ginseng teas, 11 ginseng capsules, 6 ginseng tea bags and 3 ginseng raw materials) 6 of them were free of any traces of heavy metals or pesticide residues at all.
Of the 25 samples detected with small amount of heavy metals, all were in compliance of the Department of Health's Limits of Heavy Metals in Chinese Medicines.
Or the WHO's Provisional Tolerable Weekly Intake of arsenic, lead, cadmium and mercury for an adult of 60 kg body weight, assuming the products were the only source of heavy metals intake.
For some samples which are not to be ingested entirely (e.g. ginseng enclosed in tea bags), the leachable contaminants in the drinkable portion would be considerably less than the detected value as these contaminants have a low solubility in water.
On pesticide residues, 3 samples were detected with a pesticide residue BHC classified by the International Agency for Research on Cancer as "possibly carcinogenic to human". BHC was previously on a United Nations list of approved pesticides but was subsequently delisted while the WHO also withdrew its proposed Acceptable Daily Intake on this substance.
In addition, 1 sample was detected with DDT, again a UN delisted pesticide, but the amount of DDT in this sample did not exceed the WHO's Provisional Tolerable Daily Intake for an adult of 60 kg body weight.
Since both BHC and DDT may cause adverse effects to the human and the environment, the Consumer Council is calling on the origin countries of ginseng plantation to investigate whether the pesticide residues detected in ginseng were due to the continual usage of such pesticides or to the soil previously contaminated by pesticides.
Manufacturers, when sourcing for raw ginseng material, are advised to ask their suppliers for independent laboratory test reports to certify the source of raw ginseng material is not contaminated.
Besides the issue of contamination, the test also examined the veracity of claims on the net weight of these prepackage ginseng products. The results showed that 4 out of the 31 samples were found to contain actually less than the declared amount of net weight by over 10%.
Parents could save up to $10,000 in baby disposable diapers
A Consumer Council test has found precious little difference in the quality and hygiene of baby disposable diapers.
That's so far as quality and hygiene are concerned, which were found to be generally satisfactory among the 22 samples.
But, not so, when it comes to their price, a vast difference exists - from 98 cents to $3.00 per diaper, a substantial price differential of 3 times!
Assuming a total consumption of 7,300 diapers (at 8 diapers a day) in the first 30 months of infancy of a baby, the savings between the most and least expensive regular diapers could amount to a sizable sum of $10,877.
Included in the test were 18 regular and 4 day-and-night/overnight diapers of various brands.
The samples were subjected to tests to investigate: leakage, surface dryness, urine uptake, pH value, cleanliness of absorbent material and effectiveness of tape fastener as well as the presence, if any, of environmental hormones Tributyltin (TBT) and Triphenyltin (TPT).
With the exception of 1 sample, which failed the surface dryness test, all samples were declared satisfactory having complied with the relevant standards.
Of particular relief is the absence of the environmental hormones TBT and TPT, which are "endocrine disruptors" that affect the endocrine system of animals and, in turn, the growth and development of the reproductive system. An earlier test in Germany revealed some diapers to contain TBT.
Parents are advised that though all samples performed satisfactorily in their urine uptake test, parents should change the diapers as often as the babies need to avoid skin irritation. Also they should choose the correct size to fit the babies.
Vast variations on scale of charges and practices by employment agencies for foreign domestic helpers
It pays to shop around for employment agencies for foreign domestic helpers.
For a recent Consumer Council survey on 20 employment agencies has revealed vast variations in the scale of charges and practices such as arrangements for replacement (if you are not happy with your original choice) and refund (if the maid fails to turn up on pre-specified date), etc.
The demand for domestic maid service is ever on the rise. The number of foreign domestic helpers, by 25% in 5 years, from 160,000 in 1995 to 200,000 early last year.
Consumer complaints related to employment agencies rose by 37% from 76 to 104 during the corresponding period. Most complaints were brought by employers dissatisfied with their maids' performance, and the refusal of the agencies to refund in disputes over performance or non-arrival of maids, etc.
Results of the survey, conducted from late February to early March this year, are as informative as they are revealing to prospective employers:
Service Charges
Service charges for direct hire from overseas varied vastly from $998 to $4,980 for Filipino maids, $2,500 to $4,880 for Thai maids, and $1,600 to $6,800 for Indonesian maids. For recruitment of maids currently residing in Hong Kong the fees ranged from $998 to $3,180, $2,380 to $3,888 and $3,800 to $5,000 respectively for Filipino, Thai and Indonesian maids.
However, prospective employers should not consider the price as the sole factor. Equally important are services covered and quality of maids. It would be advisable to consult friends and relatives for a reputable and reliable employment agency.
Maid Selection
The majority of employment agencies offered facilities such as videotapes, photographs, medical reports and agency's comments of the maids to assist customers in the process of selection. 13 of them would, upon request, help customers telephone maids of their choice for direct assessment.
Replacement Guarantee
If the employer is not satisfied with the maid's performance, replacement is guaranteed by most employment agencies. In most cases, expenses paid to overseas authorities (including consulates and embassies), visa and return airfare of the replaced maid as well as one month's wage may be needed.
Refund arrangements
If a prospective maid fails to show up and the customer insists on terminating the agency service, 4 of the employment agencies surveyed would refund fully to the customer whereas 3 employment agencies would not. In practice, most agencies would offer replacement and retain the money for the process of a new application. Refund will only be made if it can be proved the agency is responsible for the maid's non-arrival.
Consumers will do well to take heed of the following advice:
- Always ask when a prospective maid will arrive and discuss the possible arrangements (e.g. replacement or refund arrangements) for late- or non-arrival. The details should be recorded in the contract.
- If a maid's performance is not in accordance with the information provided by the employment agency, contact the agency as soon as possible and ask for replacement or refund.
- It is an offence to employ foreign maids willing to accept monthly wage less than the minimum allowable wage stipulated in the employment contract.
- Allow time and patience for newly-arrived maids to adapt to their new working environment and be considerate to their different culture and religion.