A bill protecting Credit Card holders has been approved by Senate in a 16-0 vote. On third and final reading the bill was approved aiming to protect credit card holders against extreme charges and harassment from collection agents.
According to Senator Sergio Osmeña III who sponsored the bill, BSP data showed that consumer complaints increased over the years. Included on the complaints were excessive charges, unauthorized fees, undisclosed charges, unfair collection and harassment practices by credit card collection agents.
Base on reports, “There has been persistent clamor from the public for us legislators to take proactive action towards protecting the consumers from potential credit card excesses while nurturing the economic benefits from the same,” Osmeña said.
Thus, House Bill No. 5417 seeks to regulate the Philippine credit card industry by granting the Bangko Sentral ng Pilipinas (BSP) supervisory powers over credit card issuers, acquirers, and transactions.
Senate President Franklin Drilon also said on reports, that the Bill is the “much-needed” reforms to the country’s banking and lending sector. It is intended to improve the overall business climate and uphold consumer rights and welfare, the Senator said.
Also added by Osmeña being the chairman of the committee on banks, financial institutions and currencies, industry records has shown an increase in the number of active credit cards. It went up to 25.5 percent from 6.584 million in 2009 to 8.268 million in 2014.
Provisions to Credit Card Holders
The proposed Philippine Credit Card Industry Regulation Law or House Bill No. 5417 will give the BSP the supervisory powers. It also mandates information confidentiality, and requires credit card issuers establish a Consumer Assistance Unit within their rank as an organization.
It also defines an “appropriate collection practices” giving responsibility on credit card issuers towards their collection agents’ actions.
Senator Osmeña reiterated that “The end game for the bill is to be a catalyst that would establish a national policy on responsible credit services by the card issuers, on the one hand, and responsible debt management for the card holders, on the other.”
The Bill also reinforces due dates that fall on weekend or regular holiday will automatically be moved to the next business day.
Any violation on the provisions of the proposed Philippine Credit Card Industry Regulation Law will be penalized by an imprisonment of two to 10 years or a fine of P50,000 to P200,000 or both, at the discretion of the court, Osmeña noted.
Addition to what Osmeña said on reports is: “We hope it inspires financial discipline at the micro-level and redound to the benefit of all in the long-haul. We have the collective responsibility to keep our credit market to operate in a safe and sound manner, and a legislative intervention is urgently needed to get our nation started towards this path of financial enlightenment and discipline”.