-
NINETEENTH CONGRESS OF THE 
REPUBLIC OF THE PHILIPPINES
First Regular Session
SENATE 
Senate Bill No. 978
rgjfl Senate
of tfj? #nvftarp
*22 AUG-1 P2 *58
RECEIVED^;
Introduced by Senator Aquilino “Koko” Pimentel III
AN ACT
PROHIBITING THE ISSUANCE OF PRE-APPROVED 
CREDIT CARDS WITHOUT THE CONSENT OF THE 
CONSUMER AND FOR OTHER PURPOSES
EXPLANATORY NOTE
Article XVI, Section 9 of the 1987 Constitution states that, “The 
State shall protect consumers from trade malpractices and from 
substandard hazardous products.”
Article 2 of Republic Act No. 7394, otherwise known as the 
Consumer Act of the Philippines, declares that “It is the policy of the 
state to protect the interests of the consumer, promote his general 
welfare and to establish standards of conduct for business and industry. 
Towards this end, the State shall implement measures to achieve the 
following objectives: x x x; (b) protection against deceptive, unfair, and 
unconscionable sales, acts and practices; (c) provision of information 
and education to facilitate sound choice and the proper exercise of 
rights by the consumer; and (d) provision of adequate rights and means 
of redress: x x x.”


According to reports, the issuance of pre-appro ved credit cards is 
among the Top 5 complaints against credit card operations1 of banks, 
quasi-banks, and/or its subsidiaries or affiliates despite the issuance of 
Bangko Sentral ng Pilipinas’ (BSP) Circular No. 702 on December 15, 
2010, prohibiting such act. The said prohibition was further reiterated 
by the BSP in Circular No. 845 dated August 15, 2014.
Credit card issuers have been using “loyalty offers” as basis when 
it comes to issuing pre-approved cards. Some also send unsolicited 
supplementary cards which are extensions of an existing cardholder’s 
initial credit card. Consumers are, in effect, deceived and enticed to use 
these pre-approved credit cards, with some ending up buried in credit 
card debts.
This bill seeks to strengthen the prohibition on the issuance of 
pre-approved credit cards to consumers and provide for heavier 
penalties for violations of this Act.
The passage of this measure is earnestly sought.
AQUILI
OKO” PIMENTEL III
1 https://www.rappler.com/business/industries/67420-decline-pre-approved-credit-cards/


NINETEENTH CONGRESS OF THE ) 
REPUBLIC OF THE PHILIPPINES )
First Regular Session 
)
SENATE 
Senate Bill No. 978
!^| Senate
of tijf ^g'rcrptarjp
*22 AUG -1 P2 58
RECEIVED BV:
Introduced by Senator Aquilino “Koko” Pimentel III
AN ACT
PROHIBITING THE ISSUANCE OF PRE-APPROVED 
CREDIT CARDS WITHOUT THE CONSENT OF THE 
CONSUMER AND FOR OTHER PURPOSES
Be it enacted by the Senate and House of Representatives of the Philippines in 
Congress assembled:
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SECTION 1. Short Title. - This Act shall be known as the uPre- 
approved Credit Card Prohibition Acf\
SEC. 2. Declaration of Policy. - Article XVI, Section 9 of the 
1987 Constitution states that “The State shall protect consumers from 
trade malpractices and from substandard hazardous products.”
Furthermore, Article 2 of Republic Act No. 7394, otherwise 
known as the Consumer Act of the Philippines, declares that, “It is the 
policy of the state to protect the interests of the consumer, promote his 
general welfare and to establish standards of conduct for business and 
industry. Towards this end, the State shall implement measures to 
achieve the following objectives: x x x; (b) protection against 
deceptive, unfair, and unconscionable sales, acts and practices; (c)


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provision of information and education to facilitate sound choice and 
the proper exercise of rights by the consumer; and (d) provision of 
adequate rights and means of redress; x x x.”
SEC. 3. Definition of Terms. —
a. Credit Card- card, plate, coupon book or other credit 
device existing for the purpose of obtaining money, 
property, labor or services on credit;
b. Credit Card Application - A documented request of the 
credit card applicant to a credit card issuer for the 
availment of a credit card;
c. Credit Card Holder - A person who owns and benefits 
from the use of a credit card;
d. Credit Card Issuer - A bank, quasi-bank, and/or its 
subsidiary or affiliate, or any entity that offers the use of its 
credit card facilities; and
e. Pre-approved Credit Card - Unsolicited credit card issued 
by a credit card issuer to a consumer who has not applied 
for such credit card.
SEC. 4. Prohibition on the Issuance of Pre-approved Credit 
Cards Not Applied For. - Banks, quasi-banks, and/or its subsidiaries 
or affiliates, or any entity authorized to be a credit card issuer shall not 
issue pre-approved credit cards to customers who have not applied for 
them.


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SEC. 5. Acts Tantamount to Issuing Pre-approved Credit Cards. 
- The following acts shall be tantamount to the issuance of a pre­
approved credit card which are violative of Section 4 hereof:
a. Sending of credit cards to consumers with no prior 
application, written request and supporting documents 
required for prudent credit card evaluation;
b. Sending of unsolicited supplementary cards and other 
cards with added features which are not in replacement 
or a substitute of an existing cardholder's initial credit 
card;
c. Unsolicited calls by credit card issuers requesting 
updated information from selected clients in order to be 
entitled to receive a credit card as a reward for his or her 
continued patronage of the credit card issuer’s other 
financial products;
d. Unsolicited calls by the credit card issuer to its depositors 
informing them that they already have a credit card from 
the card issuer’s Credit Card Department due to good 
standing as a depositor;
e. Sending of mails with credit card enclosed which will be 
deemed accepted upon the receipt of such card by a 
receiver, whether authorized or not;
f Sending to a consumer an unsolicited credit card which 
is deemed accepted unless a request for termination is 
promptly instructed by the cardholder to the credit card 
issuer; and


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g. Sending of credit cards as free offers to consumers who 
availed themselves of the credit card issuer’s other 
financial products.
SEC. 6. Harassment by Credit Card Collection Companies. — 
Credit card collection agents shall be prohibited from engaging in any 
unethical collection activities or any form of harassment against 
consumers who use pre-approved credit cards.
SEC. 7. Duty of Credit Card Issuers. - Banks, quasi-banks, 
and/or its subsidiaries or affiliates, or any entity issuing credit cards 
must exercise, in accordance with the Manual of Regulations for Banks 
(MROB) and the Manual of Regulations for Non-Bank Financial 
Institutions (MORNBFI), proper diligence by ascertaining that 
applicants possess good credit standing and are financially capable of 
fulfilling their credit obligations.
SEC. 8. Penalties. - The penalty for violating any of the 
prohibited acts under this Act shall be:
a. First Offense: Censure for the directors and officers of the 
credit card issuer responsible for the violation and a fine of 
Three Hundred Thousand Pesos (PhP 300,000.00).
b. Second Offense: Suspension of the credit card issuer 
concerned from the credit facilities of the Bangko Sentral ng 
Pilipinas (BSP) and a fine of Five Hundred Thousand Pesos 
(PhP 500,000.00).
c. Third Offense: Revocation of the license to engage in the credit 
card business and a fine of Eight Hundred Thousand Pesos 
(PhP 800,000.00).


SEC. 9. Implementing Rules and Regulations. — Within sixty (90) 
days from the effectivity of this Act, the BSP shall formulate rules and 
regulations for the proper implementation of this Act.
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SEC. 10. Separability Clause. - Should any provision or part of 
this Act be declared unconstitutional or invalid, the other provisions 
and parts hereof, insofar as they are separable from the invalid ones, 
shall remain in full force and effect.
SEC. 11. Repealing Clause. - All laws, decrees, orders, 
issuances, rules and regulations or parts thereof which are inconsistent 
with this Act are hereby repealed or modified accordingly.
SEC. 12. Ejfectivity Clause. — This Act shall take effect fifteen 
(15) days after its publication in the Official Gazette or in at least two 
(2) newspapers of general circulation.
Approved,