Credit card delinquency occurs when a cardholder has a poor payment history, and frequently pays bills after the due date. The credit lines of delinquent cardholders are also often fully utilized, which may be a reflection of a very tight cash flow.
Credit card receivables in the Philippines booked a double-digit decline of 11 percent to 405 billion pesos as of end- September last year from 456 billion pesos in 2019 due to significant reduction in billings.
To ease the burden of consumers, the Bangko Sentral ng Pilipinas issued Circular 1098, capping the interest rates on credit card charges to two percent per month.
BSP Deputy Governor Chuchi Fonacier earlier issued Circular Letter 2021 – 008 calling for the strict compliance with prevailing regulations on credit cards and financial consumer protection as well as the provisions of the Bayanihan laws after the regulator received a high number of credit card-related complaints.