SIXTEENTH CONGRESS OF THE REPUBLIC 
OF THE PHILIPPINES 
Second Regular Session 
SENATE 
) 
) 
) 
S. B. No ... 25_a6 _ 
Introduced by Senator Miriam Defensor Santiago 
AN ACT 
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OEG 22 P 1\ ;1' 
TO PROVIDE FOR A MORE DETAILED AND UNIFORM DISCLOSURE BY 
CREDIT AND CHARGE CARD ISSUERS WITH RESPECT TO INFORMATION 
RELATING TO INTEREST RATES AND OTHER FEES WHICH MAYBE 
INCURRED BY CONSUMERS THROUGH THE USE OF ANY CREDIT OR 
CHARGE CARD 
EXPLANATORY NOTE 
The last decade has witnessed the ph(~nomenal growth of credit cards in the 
Philippines. Banks and other financial inslilntions have included credit cards in their wide 
an'ay of financial services. 
However, there is no specific law regulating the solicitation of applications of 
credit cards and the imposition of interest and penalty charge. Many cardholders have 
been victims of being ch,ll'ged with additional inter(",ts and pl!nallies, or both. be"m15(-' of 
-
. 
their ignorance on the application of such fees. Present and prospeetiv<c credit card 
holders must be sufticiently informed of what they are entering into. 
This bill seeks to regulate the credit card indm;trv by providing for the di<,cioSllrc 
by credit card issuer of information relating jo interest rates, pcnalties and other feee' 
which may be incurred through the use (Of any credit card or charge card. I 
1 This bill was orig111(dl~, filed during the Thirteenlll COJtgre<;s Fir<:j Regular Session, 


SIXTEENTH CONGRESS OF THE REPUBLIC 
OF THE PHILIPPINES 
Second Regular Session 
SFNATE 
) 
) 
) 
S. B. No._~ _~536 
Introclucect hy Senator Miria'l1 Defensor Santiago 
Be it enacted by the Senate and the House of Representatives of the Philippines in 
Congress assembled: 
AN ACT 
TO PROVIDE FOR A MORE DETAILED AND UNIFORM DISCLOSURE BY 
CREDIT AND CHARGE CARD ISSUERS WITH RESPECT TO INFORMATION 
RELATING TO INTEREST RATES AND OTHER FEES WHICH MAYBE 
INCURRED BY CONSUMERS THlWUGH THE USE OF ANY CREDIT OR 
CHARGE CARD 
SECTION 1. Short Title. - This Act may be cited as the "Fair Credit and Charge 
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Card Disciosll1'e Act 01'2014." 
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SECTION 2. Declaration of Policy.- It is the policy of the state to protect the 
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right of consumers by providing for the disclosll1'e by credit and charge card issuers of 
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information relating to interest rates, penalties, fines, and other fees which may be 
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incurred through the use of any credit or charge card. 
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SECTION 3. Definition ofTerms.- For purpose of this Act, the term: 
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(A) "Charge Card" means any card, plate or other single credit card device that 
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may be used from time to time to obtain credit; 
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(B) "Credit Card" means any card, plate, coupon book or other credit device 
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existing for the purpose of obtaining money, property, labor or services on credit; 
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(C) "Open-end-credit-plan" means a consumer credit extended on an account 
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pursuant to a plan which: 


(l) the creditor may permit the person to make purchases or obtain loans, 
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from time to time, directly [rom the creditor or indirectly by use of credit card, 
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check or other device; 
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(2) the person has the privilege or paying the balance or a finance charge 
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may be computed by the creditor t1'om time to time on an outstanding unpaid 
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balance; and 
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(3) a f1nance charge may be computed by the creditor from time to time on 
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an outstanding unpaid balance. 
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(D) "Board" means the Monetary Board; 
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(E) "Penalty Charges" means such amount of interest imposed on the credit card 
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holder for non-payment of an account within a prescribed period, 
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SECTION 4. Direct Mail and Solicitation . .. Any application to open a credit card 
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account for any person under an open-end credit plan or a solicitation to opcn such an 
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account shall disclose the following information: 
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(A) Annual Percentage Rale,- Each annual percentage rate applicable to 
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extensions of credit under such credit plan, Where an extension of credit is subject to a 
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variable rate the fact that the rate is variable, the annual package rate in effect at the time 
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of the mailing, and how the rates is determined, Where more than one applies, the range 
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of balances for more than each rate applies, 
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(B) Annual and Other Fees,- Any annual fee, other periodic fee, or membership 
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fee imposed for the issuance or availability of a credit card, including any account 
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maintenance fee or any other charge imposed based on activity or inactivity for the 
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account during the bill ing cycle, 
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Any minimum finance charge imposed for each period during which any 
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extension of crcdit which is subject to a finance charge is outstanding. 
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Any transaction charge imposed in connection with use of the card to purchase 
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goods or service. 
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Any a penalty or surcharge imposed for the delay in payment of an account 
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(C) Grace Period.-- The date by which or the period within which any credit 
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extended under such credit plan for the purchasc of goods or services must be repaid to 
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avoid incurring a finance charge, and if no such period is offered, such fact shall be 
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clearly stated. If the length of such grace period varies, thc card issuer may disclose the 
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range of days in the grace period, the minimum number of days in the grace period, or the 
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average number or days in the grace period. ifthc disclosme is identified as such. 
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(D) Balance Calculation Method. 
The name or the balance calculation method 
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used in determining the balance by which the finance charge is computed. The method 
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used has been defined by the Board, or a detailed explanation of the balance calculation 
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method if the method has not been so dci1ned. 
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In prescribing regulation to carry Ollt this law, the Board shall define any name not 
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which is composed of more than five (5) balance calculation methods determined to be 
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the most commonly used methods. 
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SECTION 5. Other Information. -- In addition to the information required to be 
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disclosed under Section 4 of this Article, each application or solicitation to which such 
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section applies shall disclose clearly and conspicuously the following information: 
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(A) Cash Advance Fee. - Any fee imposed for an extension of credit in the form of 
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cash; 
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(13) Latc Fee. - Any fee imposed for a late payment; and 
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(C) Over-the-Limit-Fee. - Any fce imposed in connection with an extension of 
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credit in excess of the amount of credit authorized to be extended with respect to such 
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amount. 
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SECTION 6. Telephone Solicitations. - In any telephone solicitation to open a 
credit card account for any person under an open-end consumer credit plan, the person 
making the solicitation shall orally disci OS" the information descrihed in Section 4 of this 
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Act. 
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SECTION 7. F:xceptions . ..... Section 4. shall not apply to any telephone solicitation 
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if the credit card issuer: 
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(A) Does not impose any fee in connection with Section 4(B) of this Act; 
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(B) Does not impose any fee in connection with telephone solicitations unless the 
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consumer signifies acceptance by using the card; or 
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(C) Discloses clearly and conspicuously that the consumcr will not be obligated to 
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pay any fees or charges disclosed unless the consumer elect to accept the card or account 
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by using the card. 
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SECTION 8. Application and Solicitation by Other Means . ... Any application to 
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open a credit card account for any person under an open-end consumer credit plan, and 
IS 
any solicitation to open such an account without requiring an application, that [ made 
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available to thc public or contained in catalogues, magazines. or other publication shall 
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meet the following disclosure requirements; 
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(A) ;\n application or solicitation described in this Section meets the requirement 
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of this pflragraph if sl1ch application or spoliation contains the information described in 
)0 
Sections 4 and 'i in a clear and conspicuolls form; 
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(B) A statement in a conspicuous and prominent location on the application or 
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solicitation, that the information is accurate as of the date the application or solicitation 
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was printed; the information contained in the application or solicitation is subject to 
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change after such date; and the applicant should contact the creditor for information on 
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any change 111 the information contained in the application or solicitation since it IS 
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printed; 
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(C) A clear and conspicuous disclosure of the date the application or solicitation 
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was printed; and 
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(D) A disclosure, in a conspicuoll<; and prominent location on the application or 
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solicitation, of a toll free telephone number or a mailing address at which the applicant 
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may contact the creditor to obtain any change in the information provided in the 
8 
application or solicitation since it was printed. 
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SECTION 9. Genera/Information Without Any Specific Term. - An application or 
10 
solicitation described in Section 8 meets the requirement of this section if such 
11 
application--
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(A) contains a statement, ill a conspicuous prominent location on the applkation 
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or solicitation, that there are costs associated with the use of credit cards; and the 
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applicant may contact the creditor to request disclosure of specific information of such 
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costs by calling a toll free telephone number or by writing to an address, specified in the 
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application; 
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(B) 
contains a disclosure, in a conspicuous and prominent location on the 
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application or solicitation, of a toll free telephone number and a mailing address at which 
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the applicant may contact the creditor to obtain such information; and 
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(C) does not contain any orthe items described in Section 4. 
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SECTION 10. 
Charge Card Application and Solicitation. - Any application 
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or solicitation to open a charge card shall disclose clearly and conspicuously the 
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folJowing information: 
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(A) Any annual fee, other periodic fee, or membership fee imposed for the 
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issuance or availability of the charge card, including any account maintenance fee or 
5 


other charge imposed based on activity or inactivity for the account during the billing 
2 
cycle; 
\ 
(B) Any transaction charge imposed in connection with use of the card to purchase 
4 
goods or services; and 
) 
(C) A statement thPit charges incurred hy use of the card is due and paYRble upon a 
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receipt of periodic statement for such charge card account. 
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SECTION 11. 
Applications and Solicitation by Other Means. -
An 
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application to open a charge account and any solicitRtion to open an account without 
9 
requiring an application, that is made available to the public or contained in catalogs, 
10 
magazines, or other puhlications shall contain: 
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(A) The information described in Sections 10 and 11 in a clear and conspicuous 
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form 
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(B) A statement, in a conspicuous and prominent location on the application or 
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solicitation, that the information is accurate as ofthe date of the application or solicitation 
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as printed; the information contained in the application or solicitation is subject to the 
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change after such date; and the applicant should contact the creditor for information on 
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any change in the information contained in the application or solicitation since it was 
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printed; 
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(C) A clear and conspicuous disclosure of the date the application or solicitation 
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was printed; and 
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(D) A disclosnre. in a conspicuous 3n prominent location on the application or 
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solicitation of a toll-free telephone number or a mailing adctress at which the applicant 
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may contact the creditor to obtain any change in the information provided in the 
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application or solicitation since it a printed. 
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SECTION 12. 
Issuer of Charge Cards Which Provides A ccess to Open End 
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Consumer Credit Plans. ··If a charge card permits the card holder to receive an extcnsion 
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of credit under an open··end consumer credit plan, which is not maintained by the chargc 
I. 
card issuer, the charge card issuer may provide the infonnation describe in Sections 4 and 
3 
10 in the form required by such sections in lieu of the information required to be provided 
4 
under Sections 5,6 and g with respect jo any crcdit extended under such plan, if the 
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charge card issuer discloses clearly an conspicllously to the conSllmer in the application 
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or solicitation that- '. 
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(A) The charge card issuer will make an independent decision as to whether to 
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issue the card; 
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(B) The charge cilrd my arrive hefore the decision is made with respect to an 
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extension of credit under an open-end consumer credit place; and 
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(C) Approval by the charge card is"uer does not constitute approval by the issuer 
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of the extension of cred it. 
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The information required to be di:;clos('d under Section I} shall he provided to the 
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charge card holder by the creditor which maintains such open-end consumer credit plan 
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bcfore the first extension of credit under such plan. 
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SECTION 13. 
Regulatorv authority of the board. .. The board may, by 
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regulation, require the disclosure of information in addition to that otherwise required by 
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the provisions and notify any disclosure of information required by this Act in any 
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application to own a credit card account for any person under an open end consumer 
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credit plan or any application (0 open a charge card aecount for any person, or a 
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solicitation to open any such account without requiring an application, if the Board 
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determincs that an action is necessary to carry out the purpose of, or prevent evasion of, 
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any provision ofthis Act. 
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SECTION 14. 
Disclosure Prior to Renewal . .. Except as otherwise provided 
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in Section 6, a card issuer that impose any fee described in Section 4 shall transmit to a 
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consumer's credit or charge card account a clear and conspicl1ous disclosure of the date 
2 
by which, the month by which. or the billing period at the close of which, the account 
3 
will expire if not renewed; 
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The information described in Section 4 or Section 10 shall transmit to a consumer 
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at least 30 days prior to the scheduled renewal date of he consumer's credit or charge 
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card account a clear and conspicuous disclosure of the date by which. the month by 
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which, or the billing period at the close of which, the account will expire if not renewed; 
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and the method by which the consumer may terminate continued credit availability under 
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the account. 
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SECTION 15. 
Special Rule for Certain Disclosures. - The disclosure 
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required by this subsection may be provided -
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(A) Prior to posting a fee described by Section 4(B) to the account, Of 
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(B) With the periodic billing statement first disclosing the fee posted to the 
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account. 
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SECTION 16. 
Limitation on Use of Special Rule. - Disclosures may be 
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provided under Section 15 only if the consumer is given a 30-day period to avoid 
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payment of the fee or to have the tee recredited to the account in any case here the 
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consumer does not want to continue the availability of the credit; 
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SECTION 17. 
Short Term Renewals. -- The Board may, by regulation, 
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provide for fewer disclosures that are requircd by this Act in the case of an account which 
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is renewable for a period ofless that six (6) months. 
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SECTION 18. Other Rules for Disclosures. - [[the amount of any fee required to 
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be disclosed under this Act is determined on the basis of percentage of another amount, 
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the percentage used in making such determination and the identification of the amount 
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against which snch percentage is applied shall be disclosed in lietl ofthe aIDOtlnt of such 
::1 
fee. If a credit or charge card issuer does nol impose any fce required to be disclosed 
1 
under any provision of this Act sLlch provision shall not apply with respect to each 
4 
ISStler. 
SECTION 19. 
Penalties. - Any issuer of a charge card or credit card found 
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violating any provision of this Act shall, after due notice and hearing, have its license to 
7 
issue credit card or charge card upended and shall be imposed a fine of not less than One 
8 
Hundred Thousand Pesos (P I 00,000.00) nor more that One Million Pesos, at the 
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discretion of the I3oard. 
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SECTION 20. 
Repealing Clause " Any law. presidential decree or isStlance, 
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executive order, letter of instruction, administrative order, rule or regulation contrary to 
I? 
or inconsistent with the provision of this Act is hereby repealed, modil1cd or amended 
13 
'accordingly, 
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SEC'TlON 21. Separability Clause. ' 
TI' any provision, or part hereof, is held 
15 
invalid or unconstitutional. the remainder of the' la or the provision not otherwise affected 
16 
shall remain valid and subsisting, 
17 
SECTION 22, Effectivity Clause . .. This Act shall take cffect fifteen (15) days after 
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its publication in at least two (2) newspapers of general circulation. 
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Approved, 
/dpmOec20 14 
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