MANILA - The maximum credit card interest rate or finance charges on unpaid outstanding balance were kept at 2 percent per month or 24 percent per year, the Bangko Sentral ng Pilipinas said Thursday.
Monthly add-on rates for installment loans were also retained at a maximum rate of 1 percent while the maximum processing fee on the availment of credit card cash advances was kept at P200 per transaction, the BSP said in a statement.
The cap is in line with the BSP Circular No. 1098 released on Sept. 24, 2020 to help cushion the impact of the COVID-19 pandemic to Filipinos.
“The decision is based on a holistic assessment of developments in the macroeconomy, the state of credit card financing as well as the safety and soundness of banks and other credit card issuers. It will also continue to help ease financial burden of consumers through affordable credit card pricing.” BSP Governor Benjamin Diokno said.
Billings and credit card applications showed an "increasing trend" when the COVID-19 quarantine restrictions were lifted, the BSP said.
Credit card receivables also posted double-digit growth of 13.5 percent year-on-year as of December 2020, the central bank said.
Retaining a low credit card interest rate is in line with the BSP's goal to keep "a low interest rate environment," it said.
The central bank has kept its policy rate at a record low of 2 percent to boost the economy.