BSP bans issuance of pre-approved credit cards

MANILA, Aug 22 (PNA) — The Bangko Sentral ng Pilipinas (BSP) has put a lid on the issuance of pre-approved credit cards.

In a Circular, the central bank defines pre-approved credit cards as the “unsolicited credit cards issued by credit card issuers to consumers who have not applied for such credit cards.”

The circular also defined the term “application” as “a documented request of the credit card applicant to a credit card issuer for the availment of a credit card.”

”The intention and consent for the availment of the credit card must be clear and explicit,” it said.

The central bank has identified seven acts on the part of the credit card-issuing entities that are equivalent to issuing pre-approved credit cards.

These include sending of credit cards to consumers with no prior application and sending of unsolicited supplementary cards that are not replacement or substitute to the initial credit card.

Banks will also be considered to have violated the rules if their staff made unsolicited calls to card holders to request for updated information in exchange for a reward.

Banks are also prohibited to send via mails credit cards that “will be deemed accepted upon the receipt of such card by a receiver, whether authorized or not.”

The central bank has been vigilant against the issue of credit cards after receiving lots of complaints such on the interest rate and the alleged harassment by credit card collecting agents. (PNA)