QuestionsQuestions (Republic Act No. 10870)
Its short title is the “Philippine Credit Card Industry Regulation Law.” The basic policy is to foster the development of the credit card industry under fair and sound consumer credit practices aligned with global best practices, promote an efficient payments system, encourage competition and transparency, and institute mechanisms to protect and educate credit cardholders.
It governs all credit card issuers, acquirers, and all credit card transactions.
It is a contract provision allowing the issuer to demand full settlement of the obligation in case of default/nonpayment of any amount due or for any valid reason.
It is nonpayment, or payment of less than the minimum amount due/minimum payment required, for at least three (3) billing cycles.
A billing cycle is the period between billings and must comprise at least fifteen (15) days.
It must contain a provision requiring merchants to perform due diligence to establish the identity of cardholders.
Finance charges and other fees arising from nonpayment in full or on time of the outstanding balance must be based on the unpaid amount of the outstanding balance.
The cardholder must be notified at least 90 days prior to any change. If unacceptable, the cardholder may terminate the account (subject to Section 25). BSP may defer compliance for a reasonable period to allow system modifications.
If a cardholder breaches the credit limit by a new transaction, the transaction may be processed at the issuer’s discretion, provided the over-the-limit fees are clearly and prominently disclosed in the table of fees and charges.
Issuers/collection agents may use reasonable and legally permissible means, but must observe good faith, reasonable conduct, and proper decorum, and must refrain from unscrupulous acts. They must not harass, abuse, or oppress any person or engage in unfair practices as defined by BSP rules.
The cardholder may report errors/discrepancies up to 30 calendar days from the statement date. The issuer must take action within 10 business days from receipt of the notice.
The cardholder may cancel anytime, provided they pay in full or enter into another agreement for payment of the outstanding balance and new purchases/debits/deferred installments through either a one-time payment or installment plan within a fixed period; repayment in installments is generally subject to interest unless the new agreement was violated.