Credit Cards and Unfair Collection Practices

There are a number of good reasons in favor of having and using a credit card. It’s like owning a gun – it’s really a matter of how you use it. I know, not because I own a gun, but because I’ve handled an international credit card institution for years.

Still, we all know the possible adverse results in the unchecked use of “plastics” or credit cards, such as this one: “THERE’S a credit-card horror story that’s become some sort of an urban legend: A television personality, after losing his job in a top network, resorts to using his plastic money. By the time he finds employment in the rival network, he has wracked up P58,000 in credit card bills. But he figures he’s not yet ready to pay in full, so he pays just the minimum amount due. Yet after five years, he is shocked to realize that his credit card debt had ballooned more than 10 times to P700,000.”

Perhaps you’ve heard, or, most probably, experienced certain “innovative” strategies used by credit card companies and their collection agencies in “persuading” you to pay (they are, of course, entitled to payment). With the rising complaints against these strategies, the Bangko Sentral ng Pilipinas (BSP) issued a set of rules and regulations governing the credit card operations of banks and affiliate credit card companies. Without limiting the general application of the foregoing, the following are considered unfair collection practices

a) the use or threat of violence or other criminal means to harm the physical person, reputation, or property of any person.

b) the use of obscenities, insults, or profane language which amount to a criminal act or offense under applicable laws.

c) disclosure of the names of credit cardholders who allegedly refuse to pay debts, with certain exceptions.

d) threat to take any action that cannot legally be taken.

e) communicating or threat to communicate to any person credit information which is known to be false, including failure to communicate that a debt is being disputed.

f) any false representation or deceptive means to collect or attempt to collect any debt or to obtain information concerning a cardholder.

g) making contact at unreasonable/inconvenient times or hours which shall be defined as contact before 6:00 a.m. or after 10:00 p.m., unless the account is past due for more than sixty (60) days or the cardholder has given express permission or said times are the only reasonable or convenient opportunities for contact.

As a rule, banks, subsidiary/affiliate credit card companies, collection agencies, counsels and other agents may resort to all reasonable and legally permissible means to collect amounts due them under the credit card agreement. However, in the exercise of their rights and performance of duties, they must observe good faith and reasonable conduct and refrain from engaging in unscrupulous or untoward acts, including those enumerated above.

I was reminded of this topic when, just last week, I handled my first case representing a credit card holder. This is something new to me because, as noted above, I was at the other side of the fence, so to speak. Maybe I should discuss more relevant topics on credit cards. (Read the full text of BSP Circular 454, series of 2004. See also: Credit cards – How to Stay Ahead of Runaway Credit Card Debt.)


  1. Hi po. May concern lang po ako, may 2 active cc po kasi ako from Eastwest and AUB, hindi po ako nakabayad for this month of July dahil sa financial crisis, but i keep communicating thru email nga lang kasi nasira yung phone ko but i already inform them, in short hindi nila ako makontak, im afraid na baka gawin nilang dahilan yung hindi nila makontak yung number ko and mag direct sila sa bahay or sa office kaya napaparanoid ako. So i decided na makipag usap direct sa 2 bank, ano po kayang pwede kong isuggest sa banko para ma settle ko ang balance ko na aagree-han nila? I’m an IT kaya medyo wala po akong wide knowledge sa kalakaran ng mga banko. Please i really need help. Thank you.


    I’m really in a state of nervous breakdown. It is unintentional that i had stopped paying my BPI cc due to series of unfortunate events. As of this moment, the SUMMONS reflects a total of almost P850K++ and running. I don’t have money to pay their demands. Any professional advise please. Or has anyone experienced this? What did you do and what happened after.

    A brief summary of the SUMMONS and COMPLAINT below:

    “You are hereby required within 15 days after the service of this SUMMONS upon you………”
    “Moreover, pursuant to the IBP-OCA Memoradum dated 12 March 2002, you are expected NOT TO FILE a Motion to Dismiss but instead, you are requested to allege the grounds of such Motion as defenses in your Answer.”
    Bank of Philippine Island (Plaintiff)
    Me (Defendant)
    Filed by: Nelson Loyola & Associates
    Civil Case No.: XX-XXXXX-CV for Sum of Money

    Wherefore, it is respectfully prayed before that Honorable Court, that judgement be rendered against the defendant by ordering him to pay plaintiff, as follows:
    a) principal claim / amount in sum of P400K++ as of XX 2016……………..
    b) The total amount of P200K++ representing the 3.40% finance charge…..
    c) Finance charge at the rate of 3.40% per month and late payment charges equivalent to 6% per month ………………….
    d) Attorney’s fees equivalent to 25% of total claims due …….. exclusive of appearance fee for every court hearing ……
    e) the cost of suit

    Further, plaintiff prays for other just and equitable reliefs.

    Makati City”

    1. If you will not answer, you will be declared in default and the Court will render judgment by default, which in all certainty, against you.

      I suggest you talk to the Bank and try to arrange for settlement of your loan, extrajudicially. Otherwise, you need a lawyer to assist you in drafting your answer.

      1. thanks @barista2016
        we called the bank and said the SUMMONS did not come from them…none on record. kausapin na lang daw namin ang collection agency. yesterday, we called Nelson Loyola (the agency) and they told us that once we conclude an agreement, balewala na daw ang SUMMONS & COMPLAINT. However, despite appealing that they bring down the balance to Principal amount without interest which is around 200K, they still sent me an email collecting for the amount of now ballooned to 900K++.

        Question, can we just keep on negotiating with the agency until a fair agreement is reached?

      2. Yes you may. but dont expect to pay only the principal. You have been in default with your loan. The Bank needs to earn interest for that.

      3. @barista2016

        would you know if any lawyer that can help me prepare the ‘Answers’? or is it possible that i myself prepare the ‘Answers’ and have it notarized then submit to MTC and the bank? i tried PAO assistance in Makati City Hall, however, I’m not qualified for PAO assistance since i have a job that earns more than 14K. As of the moment, i really can’t afford a private attorney to represent me coz i know it would be costly.

        any attorney here who can help prepare the ‘Answers’ just to comply with responding to the Summons & Complaint? let me know how much pls.

  3. Atty., ask ko lang po meron po ako unsecured loan sa isng coop bank. Tapos po biglang nagsara ang bngko.. lately po mejo nalalate na rn po ang payment ko. Ano po bng dpat kong gawin? Kung hndi po ba ako mgbabayad madedemanda ako? Slamat po

    1. @ Desperate

      Since the Bank already closed, it is the PDIC who will collect the loans in behalf of the Bank. The PDIC may ask you to pay your loan. Yung tanong kung madedemanda ka, pwede for collection of sum of money if PDIC decided to file the case against you.

  4. Good Morning Active pa po ba ito? I received call on my credit card problem said na mag sherif na pupunta sabi ni SPO1 Dennis Peria and a call from Atty Advincula Jr. na dapat whitiin this day makabayad ako ng 50k kung hindi i sherif yung bahay ng parents ko and may warrant of arrest na ako withiin72 hours.

      1. I think hindi yan totoo. Collection of money is a civil case. Non-payment of debt is not a criminal offense. Kaya walang warrant of arrest.

  5. @barista2016 – nagtataka nga po ako kasi wala nmang akong na re-received any documents from them and i think 1 year na walang tumatawag sa akin and suddenly nakuha nila telephone number ng office namin at yung agad ang bungad ng sinasabing SPO1Dennis Peria sa akin. tapos tawagan ko daw si Atty David Advincula Jr kasi may case number na daw po ako (CC-5290-016) para daw po paki usapan ko si complainant which is si Atty…possible po ba na yung Atty Advincula ang magiging complainant ko since sa eastwest bank nman ako may atraso?

  6. @barista2016
    possible po ba na yung abugado ng eastwest ang complainant kahit may nag email na po sa akin last 2015 from TELANLAW regarding amnesty program. Bka po kasi magbayad ako sa sinasabi nilang 50k tapos matulad sa iba na after a year may tumawag na naman ulit na ganun na naman yung utang sa cc.

  7. Hello Sir,

    Ang case ko po ay nag enter ako ng agreement last November 2016 with Saulog and Deleon Law Offices with my defaulted BPI cc account since 2013. (Wala pa po kasi akong malay sa mga pakana ng mga CA na yan).

    In short ang napagkasunduan namin (they insisted pala) na balance ko ay 53,600.00 payable in two years. Pinag deposit po muna ako ng 3k, tapos 2,300 ang monthly amortization na nag start noong December 2016. Nakabigay na po ako in total ng 12,200, di ako nakahulog ng 4 months (Feb, Mar, Apr, Jul). Hirap na po ako maghulog kasi medyo mabigat din at may hinuhulugan pa rin akong ibang card.

    (Nagsimula po kasi ang financial problem ko nung ma major brain surgery ang mother ko ng December 2012 na halos 500k nagastos naming magkakapatid (galing sa utang ang bulk ng gastos), tapos na stroke uli ng last week ng October 2013, nacomatose at di na nagising. Naka life support na lang siya at nag decide kami magkakapatid na tanggalin na after 10 days kasi di na siya makakarecover. Hundreds of thousands na naman po nagastos at magkakapatid lang kaming nagtutulong tulong magbayad, in addition pa po ito doon sa mga nautang namin nung maoperahan siya.

    Kaya nag research po ako last week lang ano pwede kong option, at isa sa mga natagpuan ko ang blog ninyong ito. Nung mag ff up po sila ng payment, nag message po ako sa CA na before I resume ng pagbabayad, bigyan nila ako ng Statement of Account na certified true and correct ng BPI, para makapag work out kami ng bagong agreement at a lower amount, at dapat written agreement na.

    Ang binigay lang po ay Summary of Payment na may remaining balance pa akong P41,400. Pwede ko po ba panindigan na pag di sila naka provide ng SOA from the bank, pwede huwag ko muna ituloy ang pagbabayad? Wala kasi kami formal na agreement, verbal lang po. Tama po ba ginawa ko?

    Patulong naman po, please…

  8. Hi, i received a letter from bpi saying :
    RE: Warrant to Seized Property against you will be serve on AUGUST 22, 2017 by Court Sheriffs & Autorities for our Deceit Case.
    I have a defaulted account with bpi, pwede po ba ito?

    1. prior to this have you received any summons & complaint (civil case)? if so, were you able to Answer the summons sent to you? if not, possible na umabot talaga sa ganyan, however, if you have no property or assets under your name, then no need to worry. wala magagawa ang bank or collection agency kung wala kang mababayad. try to email bpi and verify rin.

  9. sir ask ko lang po i have personal loan po kc din n deliquent ung credit card ko po sa citibank may tumawag po sa akin n pag hindi po daw na settle yung cc ko po mg add din daw po cla ng interest and penalty sa personal loan ko po kasi nka link po daw ung loan ko sa cc ko po ask ko lang po if pwde po ba yun and legal po ba??

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