MANILA - The cap on credit card interest rate will help reduce the burden of Filipinos reeling from the impact of the COVID-19 pandemic, the Bankers Association of the Philippines said Friday.

Credit card policy reform is crucial especially during this difficult time, BAP said in a statement.

"We support this initiative by the Bangko Sentral ng Pilipinas. This will help ease the burden of every household including businesses affected by the pandemic," BAP managing director Banjamin Castillo said.

The Bangko Sentral ng Pilipinas on Thursday said it would put a cap on interest rate that banks were allowed to charge for credit cards at 24 percent per annum starting Nov. 3, equivalent to an interest rate of 2 percent per month.

• Bangko Sentral caps credit card interest rates at 2 percent per month

BSP Gov. Benjamin Diokno earlier said high credit card interest rates in the country that goes up to 40 percent were "unacceptable."

The interest rate cap for credit cards is unlikely to hurt the income of banks and card issuers, the central bank said.

BAP also lauded the BSP for its "decisive and aggressive" actions. The BSP earlier brought the overnight borrowing rate to its all-time low of 2.25 percent.