BANKS and financial institutions have been in the news often as among the major groups responsible for the current global financial crisis. Yet, they do not seem to realise how their hurried and ill-conceived policies have a strongly negative impact on small businesses and ordinary workers.

Buying on credit is almost never a good idea, but if credit it must be, then no reasonable person would object to the bank charging an extra amount for lending the money, which we call interest.

However, what makes credit more and more abhorrent is the host of related charges that banks have devised in order to maximise profits.

Among these extra charges, the most unfair is the charge imposed for late payment.

Since none of us has an assurance of what will happen on the morrow, there can be no justification for asking people to pay more because they are late paying.
Owing to this unfair charge, the overall number of defaulters on the principal sum will increase.

That the "credit crunch" still makes headlines is proof banks are not getting paid on time in spite of all the punitive measures taken.

Banks have come to offer credit at an incredibly high price considering that they do not provide an equally incredible good service.

Counter staff are often slow, unreceptive and unhelpful.

Bills are sometimes sent out with mistakes that customers are expected to have rectified at their own expense and time, and ATM machines are often out of service. It is often difficult to reach banks through the telephone.

With all the faults that banks are guilty of, we can hardly imagine that they are entitled to charge their customers for not being perfect.

When banks and financial institutions behave in this unwise manner, we can expect that other businesses will follow suit and adopt an equally uncaring and aggressive manner in dealing with their customers.

The government seems eager to attract investment into the country and investors are attracted by the ease of doing business.

Late payment charges surely make business difficult for the small entrepreneur and for the big investor alike.

Therefore, abolishing late payment charges once and for all could prove the best stimulus to the economy yet.