What collection rules apply to unpaid credit card debt in the Philippines?

If unpaid credit card debt is being collected by a bank or its agent, the BSP Manual of Regulations for Banks says collection must use reasonable and legally permissible means. Banks must observe good faith, reasonable conduct and proper decorum, and must not harass, abuse, oppress or use unfair practices.

Conduct BSP lists in its unfair-collection guidance

The current consolidated MORB lists conduct such as:

• violence or threats of violence;
• obscene language, insults or criminal means;
• disclosing the names of cardholders who refuse to pay, subject to the rule's stated exception;
• threatening action that cannot legally be taken;
• communicating false credit information, including failing to communicate that a debt is disputed;
• deceptive means to collect or obtain information; and
• contact before 6:00 a.m. or after 10:00 p.m., unless an exception in the rule applies.

The MORB presents these as guidelines, says the list is not exhaustive, and does not treat every listed fact as automatically conclusive by itself.

Notice before a collection-agency endorsement

A bank or affiliated credit-card company must inform the cardholder in writing at least seven (7) business days prior to the actual endorsement of the account to a collection agency, or before transferring the account from one collection agency to another. The notice must include the agency's name and contact details. Only one collection agency should handle an account at a time, and collectors must disclose their true identity.

The bank remains responsible

Outsourcing does not remove the bank's responsibility to its cardholder. The MORB says the bank remains responsible for observing the rules even when a third-party collector performs the work. These provisions govern BSP-supervised banks and their credit-card collection arrangements; they do not decide whether a particular balance is accurate or settle an individual dispute.