Collection practices

MANILA, Philippines — Ever received threatening phone calls from a credit card collection agent? How about calls in the wee hours of the morning or in the middle of the night?

Worry not, the Bangko Sentral ng Pilipinas (BSP) actually has regulations that prohibit credit card issuers and their collection agents from engaging in unfair collection practices.

According to the BSP, credit card issuers and their collection agents should observe good faith and refrain from engaging in unscrupulous acts that would harass and humiliate the credit card holder.

In a recent public advisory, the BSP enumerated the following instances of unfair collection practices:
— The use of threat or violence or other criminal means to harm the physical person, reputation, or property of any person.
— The use of obscenities, insults, or profane language which amount to a criminal act or offense under applicable laws.
— Disclosure of the names of credit card holders who allegedly refuse to pay debts.
— Threat to take any action that cannot legally be taken.
— Communicating or threat to communicate to any person credit information which is known to be false, including failure to communicate that a debt is being disputed.
— Any false representation or deceptive means to collect or attempt to collect any debt or to obtain information concerning a card holder.
— Making contact at unreasonable or inconvenient times or hours which the BSP defines as “contact before 6 a.m. or after 10 p.m., unless the account is past due for more than sixty (60) days, or the card holder has given express permission (that he or she be contacted), or said times are the only reasonable or convenient opportunities for contact.”

BSP Circular No. 702, dated 15 December 2010, specifies that banks or quasi-banks and their subsidiary/affiliate credit card companies should inform their card holders of the endorsement of the collection of their account to a collection agency or agent at least seven days before the actual endorsement.

This also applies in the event of a bank or credit card company’s endorsement of a card holder’s account from one collection agency/agent to another.

The notification shall include the full name of the collection agency and its contact details, according to the BSP circular.

Banks or quasi-banks and their subsidiary/affiliate credit card companies are also directed to adopt policies and procedures to ensure that the personnel handling the collection of accounts shall disclose his/her full name and true identity to the card holder.
This directive covers both in-house collectors and third-party collection agents.

Put in mind, however, that you can always avoid the embarrassment of having to deal with debt payment if you contact your credit card company immediately should you find yourself having trouble paying your bills.
Try to work out a modified payment plan that would reduce your payables to a more manageable level. Do not wait until your accounts get turned over to a collecting agent.

The BSP’s Financial Consumer Affairs Group (FCAG) advises the public to report unscrupulous collection practices and other credit card-related concerns via telephone numbers (632) 708-7087 or (632) 524-7011 local 2584, fax number (632) 525-8930, or e-mail address consumeraffairs@bsp.gov.ph. –ATTY. IGNACIO R. BUNYE, Manila Bulletin

Note: You may e-mail us at totingbunye2000@gmail.com. Past articles may be viewed at http://speakingout.ph/speakingout.php.