Credit card surcharges are unlawful, says DTI


Posted at Oct 17 2010 04:44 PM | Updated as of Oct 18 2010 09:03 AM

MANILA, Philippines- Credit cards give consumers the advantage of purchasing goods and services without carrying any money since they are a convenient substitute for cash or check.

But do you know that unscrupulous business establishments are taking advantage of credit card holders by imposing 5-10% surcharges? Most of the consumers are not aware that these surcharges are illegal.

In an interview with "[email protected]," Trade Undersecretary Zenaida Maglaya revealed the illicit tactics of some business establishments that are imposing additional charges on items purchased through credit cards.

“Surcharges are illegal. There is such a thing as one price tag policy. What you see on the actual price tag is the only cost that you must pay, no more, no less,” said Maglaya.

Under Article 81, or the “Price Tag Requirement,” of Republic Act 7394, otherwise known as “Consumer Act of the Philippines,” goods and services must have only an appropriate price tag or label. It must not be sold at a higher price that what is stated and without discrimination to all buyers.

Maglaya also noted that some merchandisers, mostly of appliances and gadgets, trick consumers by giving in-store promos of discounts for cash basis to discourage credit card payments.

Maglaya also advised consumers who were tricked into paying the surcharges to ask for a refund and report the incident to the Department of Trade and Industry (DTI).

“They (merchandisers) should not pass 5-10% surcharges to the consumers for they are already paying annual membership fee for using credit cards,” said Maglaya.

In ensuring consumers’ rights, Maglaya said the DTI is monitoring business establishments through secret marshalling. She also disclosed that DTI is closely working with retailers association.

Maglaya warned violators that they will be fined as much as P 300,000, depending on the gravity, and/or revocation of their business permit and license.

For complaints and questions, you may reach DTI’s hotline number 7513330 or visit

Maglaya, meantime, gave the following tips to credit card holders:

1. Know your budget- Once you use your credit cards, you cannot track down the expenses and how much you have spent.
2. Do not be tempted, do not let yourself be trapped- Unless it is really important, do not use credit cards. Paying through cash is better than paying through credits
3. Be a wise consumer. Know your rights.