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Credit Card Basics

Have you or someone you know experienced trouble paying your credit card bills? Are you dreading that phone call from your bank, nicely asking you to settle your dues or else? Or maybe you just don’t want to pay that annual membership fee from that card you barely use.

Lucky for you, the Philippine Congress recently passed a bill that may halt all that. The Philippine Credit Card Industry Regulation Act, approved less than a week before the country changes presidents, aims to put the Bangko Sentral ng Pilipinas (BSP) in charge of supervising credit card issuers. This piece of legislation, which awaits President Rodrigo Duterte’s signature to be made into law, aims to make credit card ownership a bit more bearable by:


1. Stopping credit card issuers and collectors from possibly harassing you

The bill explicitly says that credit card companies should not “harass, abuse or oppress any person or engage in any unfair practices” when collecting debt. The BSP could soon define what that exactly means, and companies are encouraged to collect debt through reasonable methods and act nice or else.


2. Limiting and removing annual membership fees (yay!)

You may have learned a trick or two from GoBear on how to avoid these fees like the plague, but wouldn’t it be better if the plague isn’t there at all? Under the bill, the BSP will have that power to wipe out those annual fees. That frees up ₱1,000 to ₱3,500 that you can spend on more important matters.


3. Making your credit card bill simpler, with (possibly) fewer hidden charges

The bill commands credit card issuers to be transparent by disclosing finance charges for unpaid amounts after a payment's due date, as well as a simple monthly or annual interest rate on the balance. Default, late payment/penalty fees or similar delinquency-related charges should also be clear. 


4. Empowering you to refuse offers to increase credit card limits

Sure, you may refuse those offers right now, depending on your bank. But that could lead to more sales talk that would tire you and lead you into just saying yes to whatever they say. This time though, the bill formally states your right to say "no, dude, get a hint or something."


5. Setting standards on how banks should behave

When the bill passes into law, the BSP will create rules of conduct and standards that will uniformly apply to all credit card issuers. 


6. Punishing credit card companies that won’t comply with the new rules above

The bill states punishments to credit card firms that won’t follow new regulations. Violators will face fines of ₱50,000 to ₱200,000, or imprisonment of two to 10 years, or both. And you know how the new president is keen on implementing the law.

A girl (with mounting credit card debt) can dream, right?

Now that owning a credit card will soon have fewer hassles, go ahead and compare credit cards with GoBear to see which one fits you best.