Question & AnswerQ&A (Republic Act No. 10870)
The short title of Republic Act No. 10870 is the "Philippine Credit Card Industry Regulation Law."
The key policy objectives are to foster the development of the credit card industry, promote fair and sound consumer credit practices aligned with global best practices, encourage competition and transparency, promote an efficient payments system, and protect and educate credit cardholders.
This Act governs all credit card issuers, acquirers, and all credit card transactions in the Philippines.
An 'acquirer' is the institution that accepts and facilitates the processing of the credit card transaction initially accepted by the merchant.
Before issuing credit cards, issuers must conduct know your-client (KYC) procedures and exercise proper diligence to ensure applicants have good credit standing and are financially capable of fulfilling their credit commitments.
Violators may be punished by imprisonment of not less than two years and not more than ten years, or by a fine ranging from fifty thousand pesos (P50,000.00) to two hundred thousand pesos (P200,000.00), or both, at the court's discretion.
If a payment due date falls on weekends or regular national holidays, it is automatically moved to the next business day.
Cardholder data must be kept strictly confidential except when: with cardholder consent; exchanged with credit info bureaus, industry or card associations; under court order or government authority; disclosed to third-party service providers for enforcement or services; disclosed to insurers or fraud investigators; and recipients are also bound to confidentiality.
Such transactions may be processed at the issuer’s discretion, provided fees for over-the-limit transactions are clearly and prominently disclosed.
Any transaction made prior to reporting the loss or theft to the credit card issuer shall be for the account of the cardholder.