Credit card transaction ceilings retained by BSP

INTEREST rate and processing fee caps on credit card transactions will stay at current levels ahead of a review next year, the Bangko ng Sentral ng Pilipinas (BSP) announced on Tuesday.

Circular 1098, issued by the Monetary Board on Sept. 24, 2020, set the maximum interest rate or finance charge on unpaid outstanding credit card balances at 2.0 percent per month, or 24 percent per year.

The maximum monthly add-on rate on credit card installment loans was also set at 1.0 percent, while the processing fee for credit card cash advances was capped at P200 per transaction.

These remain in effect but “the reasonableness of the ceilings shall be subject to further review in January 2023,” the central bank said.

“The BSP will continue to closely monitor evolving domestic and external developments that will impact the state of credit card financing, sustainability of credit card operations and viability of banks/credit card issuers,” it added.