PAP has the ability to profit from citizens in anyway it wants and its greed is really insatiable.
While a pink notice reminder fee of 50 cents is acceptable as Singapore Power customers occasionally overlook payment, the 1% per month charged for late payment is exorbitant by any measure.
The late payment charge of ‘1%’ is misleading because it is not stated as ‘per annum’ but ‘per month’. SP customers have been fleeced for decades because the effective interest rate is 12% per year.
1% per month = 12% per year.
Is SP a mini Ah Long?
The other issue is SP has also been fleecing consumers by levying 7% GST on late payment charge which is neither a good nor service. The government has to put a stop to this unethical practice.
Considering Singapore Power (SP) does not lose 1% on interest on the late payment, or even close, why is it allowed to profit from consumers in such a manner? Why should SP be allowed to act as a credit card company of sorts?
SP customers are already required to place a deposit since day one: SP has been earning a huge amount in interest income from our deposits.
For a single late payment, SP has levied a fee of $1.69. Question: What about the interest income it has been earning on my $150 deposit for the past 30 years? No pakai isit?
How much interest income has SP been earning from 1.3 million households? What about businesses which are required to place much higher deposits?
I guess SP has been allowed to earn undeserved income because it is another government-linked company, one of Temasek’s major investments.
In FY 2016, SP’s profit was $924 million and the previous year, $991 million.
Source: Temasek Review 2016
It is unethical to force consumers to pay a 12% penalty for overlooking payment. Worse, levy a 7% GST on a non-existent good/service.
* The author blogs at LikeTatAlsoCanMeh.