BSP maintains COVID-19 shield for credit card users
Banking regulators have kept the interest rate cap on credit card transactions at 2 percent per month or 24 percent per year, citing the need to help consumers amid the ongoing impact of the COVID-19 pandemic.
According to Bangko Sentral ng Pilipinas, the maximum interest rate or maximum financing fee on a cardholder’s unpaid outstanding credit card balance remains at the level set in September 2020.
That means the monthly mark-up rates that credit card issuers can levy on installment loans will remain at a maximum of 1 percent.
Additionally, the maximum processing fee for claiming cash advances via credit card remains at P200 per transaction.
“The Monetary Board’s decision will continue to help ease the financial burden on consumers of affordable credit card pricing amid the ongoing COVID-19 pandemic,” BSP Gov. Benjamin Diokno said in a statement.
Keeping the cap on interest rates and fees “will also allow BSP to assess the impact of improving macroeconomic fundamentals and easing mobility restrictions on the performance of the credit card industry,” Diokno said.
GNP data shows demand for credit cards eased in the second half of 2021 as consumers switched to alternative digital products.
The number of issued and outstanding credit cards increased by 0.3 percent to 10.3 million.
But monthly card settlements rose 34 percent year-on-year to 100.6 billion pesos, while credit card receivables rose 4.9 percent year-on-year.
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