When there's no cash to pay for school, use cards

Families are juggling their budgets after the long school and college summer holidays. Education payments are on top of their minds as schools reopen on Sunday.
There are tuition and transport fees to pay, and residents who find it hard to balance their budgets are using cards liberally even though they come with hidden charges.
A recent Zurich survey said it costs Dh1 million on an average to send a child to school and college in the UAE. Tuition fees are paid monthly, but schools, who have outsourced transport facilities, now want quarterly payments. This is putting additional strain on home financials. Cards, therefore come in handy, feel many residents.
HSBC's latest survey shows nine in 10 people in the UAE (89 per cent) support a parent or child financially, and most families tap into credit cards to make ends meet. Debts then mount. It's a tricky cycle that many are finding hard to get out of.
Stagnant salaries and rising cost of living means there is little or no surplus after rents and education payments. Many parents are even digging into their savings and retirement funds to ensure their kids go to the best schools and colleges.
Khaleej Times spoke to parents to understand how families are coping with rising fees and transport charges. Shaheen Irani Hrib has a 10 year daughter studying in a British curriculum school. Her term fee works out to Dh17,516.
"We love the school and my daughter has been there since Foundation stage 2 and we really think of the place as family.
However, the only problem we have with them is that the fees keep going up and there is no justification for it."
Hrib was offered a RakBank credit card which came with zero-interest rate with reduced processing fee for six and 12 months. However, the catch here is that it is not free. There is one per cent processing fee over a six-month period and two per cent for payments over 12 months
Emirates NBD offers a cashback on card payment which treats education as 'retail spending'. First Abu Dhabi Bank offers benefits to card holders whose children study with GEMS group, while Mashreq bank offers a free smart device when school fees are paid using a Mashreq credit or debit card. Cardholders get guaranteed rewards in the form of smart devices when they make school payments.
Pankaj Kundra, head of Payments at Mashreq Bank said: "Times have changed and education no longer means just academics; to succeed, kids need to be multi-skilled, more informed and expect to learn in a fun way. 'Info-edu-tainment' is what parents and kids seek, and to support this endeavor, we have crafted a unique Back-to-School promotion that not only helps better planning of school fee expenses, but also creates more value for both parent and child, through a set of smart and engaging rewards."
"I have two daughters studying in grade four and five and there is no denying the fact that education fees take a chunk of our expenses A little consideration in terms of easy payment plans from schools can help ease the burden, says Elwin Lewis.
Deepti Ramachandran, who has two boys says, "Parents are struggling given the fee structure. Schools must show some flexibility to make it easier for us.
- sandhya@khaleejtimes.com

• Dubai