Senator Loren Legarda slammed the deceptive practices employed by certain credit card companies, including the collection of exorbitant or unreasonable punitive interest rates and unjustifiable fees from credit card holders.
“There is already an uproar in the United States on the predatory lending practices of credit card firms, leading US President Barack Obama to meet with the heads of credit card firms and to call for their stricter regulation by government,” said Legarda.
“A similar move should be made in the Philippines because I am certain that local credit card holders are in the same sinking boat as their American counterparts, although they may just be suffering in silence,” she said.
A research by a national daily put the estimated number of credit card holders in the Philippines at 5.5 million in 2007 from just 2 million to 2.5 million in 1997. In 2005, the total worth of credit card transactions in the Philippines was pegged at P200 billion.
Legarda said that the common complaints against credit card issuers are their arbitrary rate increases contained in the fine print of credit card contracts, as well as their use of burly collection agents to follow up payments.
“These collection agents are notorious for their bullying tactics that include harassing calls during the night and at the place of work of credit card holders,” she said. “Some have also complained why their check payments are not accepted by some credit card issuers.”
She noted the creation of a Credit Cardholders’ Bill of Rights in the US, which brings more transparency to the contractual relationship and empower consumers to manage their own credit.
“Definitely, our government must protect consumers who are lured by credit card companies with promises of low interest rates that go up sky-high without rhyme or reason,” said Legarda.–Manila Standard Today