MANILA – The Monetary Board, the policy-making body of the Bangko Sentral ng Pilipinas (BSP), has approved the implementing rules and regulations (IRR) of the law regulating the Philippine credit card industry, a move that is expected to put an end to arbitrary impositions by card issuers on their clients.
The IRR provides guidelines for the implementation of Republic Act No. 10870, or the Philippine Credit Card Industry Regulation Law, which seeks greater transparency among credit card issuers and better protection for the consuming public.
"The IRR addresses the key customer concerns regarding credit cards, particularly on the transparency and manner of computing charges and fees, safeguards against unfair collection practices, immediate posting of payments, confidentiality of consumer data, and expeditious resolution of complaints and disputed transactions, among others," the BSP said in a statement on Friday.
The guidelines require all credit card issuers to fully disclose the manner of computing finance charges and other fees in credit card use. Ample notification is also required prior to effecting any changes in the said charges.
Under the rules, disclosures must be included in application forms, the terms and conditions of credit card contracts, and billing statements. The rules further state that finance charges must be computed based on the unpaid amount of the outstanding balance as of statement cut-off date, and shall not include current and deferred charges.
Payments using cash, check or debit cards, made through any accredited payment center shall be posted on the same day by credit card issuers.
Meanwhile, due dates falling on weekends or holidays shall be automatically moved to the next business day.
Apart from ensuring greater transparency, the IRR also strengthens its rules against unfair collection practices and protects the cardholders' right to data privacy and redress.
"Collection agents must observe good faith, fair and reasonable conduct, and proper decorum when dealing with all consumers, including cardholders already in default," the BSP said.
The rules state that customer information can only be shared to third parties upon a cardholder’s informed consent, and under specific conditions defined by the law.
It also requires credit card issuers to have consumer assistance units that would address the consumers' concerns such as billing errors, unauthorized transactions and other credit card related issues.
The BSP said the IRR considers a phased implementation of some provisions of the credit card law accounting for the necessary adjustments in the systems and processes of existing credit card issuers.
The BSP cited that more than 8 million credit cards have been issued in the country, noting that there is further potential for expansion. "The recently approved rules aim to ensure that such growth in the credit card industry will be safe and sound, and one that protects consumers," it said. (PNA)
