Using a Japanese Credit Card

[Jizzeez]

I have a Tokyo Mitsusubishi UFJ Mastercard. It differs to a Western credit card in that you have to pay the balance within six weeks unless you specify that you would like to pay over two or three months when you make your purchase. I wondered if anyone knows what happens if you don't make your payment. Mine is taken by direct debit from my account. I overspent and cannot cover the balance in one month. Is there a way to defer payment for a month? Will they charge me a fortune if I don't contact them? Will my credit rating in Japan be affected? Help! I know I was silly but thought that I would just get charged a bit of interest on the balance like back in the UK. I'm worrying that this could be more serious here in Japan where the card system is different.

[Nyororin]

Originally Posted by Jizzeez

I have a Tokyo Mitsusubishi UFJ Mastercard. It differs to a Western credit card in that you have to pay the balance within six weeks unless you specify that you would like to pay over two or three months when you make your purchase. I wondered if anyone knows what happens if you don't make your payment. Mine is taken by direct debit from my account. I overspent and cannot cover the balance in one month. Is there a way to defer payment for a month? Will they charge me a fortune if I don't contact them? Will my credit rating in Japan be affected? Help! I know I was silly but thought that I would just get charged a bit of interest on the balance like back in the UK. I'm worrying that this could be more serious here in Japan where the card system is different.

Tokyo Mitsubishi allows you to defer payment to your revolving balance via their online account service...
Which I am guessing you don`t know about and haven`t registered for. I would call them and ask them to move so much to your revolving account ASAP - you can only do it up to so many days before payment is due.

If you do not pay (or rather, if the automatic debit fails), they will send out a postcard to your Japanese address giving you a week or so to make the payment by direct deposit. If you don`t, I believe they block use of the card and send out a certified letter with payment information. I have no idea what happens after that as we have only done the postcard bit (not overspending, but sick with the flu and not putting the money in that account in time...)

I imagine that it WILL effect your credit here. Just paying 2 days late once for us ended with not being able to get a car loan more than 2 years later. Japanese credit operates on the same level as a bank loan - not making a payment falls into the same category as not paying your mortgage or skipping a car payment.

[Jizzeez]

Thanks for your advice. I called the number to revolve my balance. It sounded like they will send me some kind of letter. I am hoping that I can understand it well enought to fill it in and get it back to them on time. I don't really understand the idea of revolving balance. Is it a way of deferring payment or dividing payment? It sounded like I will still have to pay a large amount of my balance this month. Perhaps I misunderstood.

[Nyororin]

Originally Posted by Jizzeez

Thanks for your advice. I called the number to revolve my balance. It sounded like they will send me some kind of letter. I am hoping that I can understand it well enought to fill it in and get it back to them on time. I don't really understand the idea of revolving balance. Is it a way of deferring payment or dividing payment? It sounded like I will still have to pay a large amount of my balance this month. Perhaps I misunderstood.

You put individual charges into the revolving balance, and pay off a set chunk of that each month. For example, 10,000 off your revolving plus however much you put into ikkatsu each month. So it is a way of dividing payment into manageable pieces.

I`m going to guess what they are sending you to fill out has to do with their online service as I`ve never heard of paperwork to change a charge to revolving.

[Sangetsu]

More than likely it is as Nyororin said, they are probably sending you an application to manage your account online.

If I were you, I would try to find some way to get some money to deposit into your account so you can cover your payment. You do not want to risk your credit rating, it's hard enough for foreigners to establish credit in Japan.

If there is no possibility of deferring the payment or deposing additional funds to cover it, you should probably apply for another credit card now, before any derogatory information gets reported. And try to get a regular revolving account rather than a charge account.

[Nyororin]

Originally Posted by Sangetsu

If there is no possibility of deferring the payment or deposing additional funds to cover it, you should probably apply for another credit card now, before any derogatory information gets reported. And try to get a regular revolving account rather than a charge account.

There is no such thing as a regular revolving account. Cards in Japan simply don`t function that way. They are always of the revolving account and 1 payment account, and when you buy something with your card you will always be asked which you would like to charge the item to. If you reply revolving, it goes into the revolving - if you reply single payment, then it is a single payment. So you can conceivably put everything into your revolving if you desire... But it`s not common at all to have that automatically happen, particularly with a regular bank card such as Tokyo Mitsubishi. There are a few cards that will do it, but think things like 100000 limit grocery store cards, etc.

[Sangetsu]

Originally Posted by Nyororin

There is no such thing as a regular revolving account. Cards in Japan simply don`t function that way. They are always of the revolving account and 1 payment account, and when you buy something with your card you will always be asked which you would like to charge the item to. If you reply revolving, it goes into the revolving - if you reply single payment, then it is a single payment. So you can conceivably put everything into your revolving if you desire... But it`s not common at all to have that automatically happen, particularly with a regular bank card such as Tokyo Mitsubishi. There are a few cards that will do it, but think things like 100000 limit grocery store cards, etc.

I wonder if we are talking about the same thing. A revolving account is a line of credit which allows you to carry a balance as high as the credit limit, but which has no terminal date, meaning that the account may be used as long as a least a minimum payment is made each month.

I have a JP Bank Visa, and it is no different than any of my 20-odd American credit cards. I can carry a balance if I like, for as long as I like, provided I pay the interest and make a minimum payment each month.

[Nyororin]

Originally Posted by Sangetsu

I have a JP Bank Visa, and it is no different than any of my 20-odd American credit cards. I can carry a balance if I like, for as long as I like, provided I pay the interest and make a minimum payment each month.

Then I`m going to guess that you have your card set to put all charges into the "revolving" portion of the card. As of this date, only one small bank offers a revolving only card - any others you can only apply for as a second card if you carry their regular card.

The problem with the auto-revo cards is that the setting can be overridden at the register if they manually enter ikkatsu instead of leaving it on default when they run the card. Something which can seriously screw you if you aren`t counting on it.

In general, the attitude here is pretty strongly against any plan which would make it hard to pay the remaining balance off very easily at bonus time, which is what keeps those types of cards from gaining any popularity. Also, revolving counts as a full fledged loan - while ikkatsu payments apparently fall into some other legal category. Apparently it is easy to get insurance bank side on cards that just offer an additional "revolving" service - but very hard for a "loan card".

[Jizzeez]

I got a statement from the card company, telling me that I would be charged for some of the items and that the bulk of the amount would be set aside. I was then charged about 5,000 yen in interest. I'm now wondering how long I can keep the amount set aside and how I pay it off when I have the money. Any ideas? I am not registered for online services. Do I call the company's revolving department again?

[Nyororin]

Originally Posted by Jizzeez

I got a statement from the card company, telling me that I would be charged for some of the items and that the bulk of the amount would be set aside. I was then charged about 5,000 yen in interest. I'm now wondering how long I can keep the amount set aside and how I pay it off when I have the money. Any ideas? I am not registered for online services. Do I call the company's revolving department again?

You should be able to find on your statement the amount that has been charged for the revolving bit.
As you say "5000 yen in interest" - I am going to guess that it`s not really interest, but rather that you are paying 5000 a month toward your revolving balance (including interest, of course).
Unless you have a special card, anything that has been placed in your revolving balance will remain in there indefinitely. You will pay so much a month toward it until the balance reaches 0.

You can contact them at a later date if you wish to make a payment to clear the balance more quickly though. You should also be able to change the revolving plan - they usually offer plans like 5000 a month, 10000 a month, 20000 month, etc.