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The Covid-19 global pandemic made many changes in how people live today. Everybody is obliged to wear a mask, remain at home as much as possible, and turn to online transactions.
And while online banking and credit cards to finance our transactions online is great, no matter how easy it is to buy and pay online, it is important to note that every transaction entails a corresponding fee that must be paid.
The problem is that this system can be abused, and clients may incur overcharging. For example, this is something that the Bangko Central ng Pilipinas (BSP) cannot allow.
With this, the Central Bank issued BSP Circular 1098 last September to limit the credit card fees, finance charges, and interests required by banks from their clients.
Also, banks are obliged to give a reason to their customers on how finance charges, interest rates, and other fees will be calculated for quick cash loan without collateral.
If you are a credit card holder, here are important things that you have to know.
Letting the Cardholder Know
In consideration of the circular issued by BSP, banks are required to inform you within a minimum of 90 calendar days for any new policies in calculating the outstanding balance and other fees charged, including charges on interests. It is important that banks provide a clear and thorough explanation with illustrations so that cardholders will be able to comprehend the policies easily.
Decrease in Annual Interest Rate
The Central Bank, starting November 3, will limit the annual interest rate at two percent to a maximum of 24 percent per annum. This allows the BSP to aid cardholders especially that there are credit card companies that charge as much as 50% or more per annum. Thus, you might be able to notice a lower outstanding balance in your account with a maximum of 60 percent due to the decrease in the yearly interest rate charged by banks.
Decrease in the Rate of Installment Add-ons
Clients patronize credit cards mainly because of its installment plans. Instead of paying the whole amount in just one billing, the amount can be paid every month or every three, six, 12 months, or 18 months on an installment basis. Other companies guarantee that there will be no interest to be paid even if you pay on installment. However, there are companies that charge an installment add-on rate at a maximum of one percent monthly or 12 percent per annum, whatever the installment term is. The result makes the repayment charges per month lesser. This limit will be applied to present and future installment transactions.
Cash Advance Fee Ceiling
Credit card companies also offer a cash advance feature which is like an ATM credit. This will enable you to withdraw cash but with an additional fee. The charge will be between two to three percent or 300 pesos to 500 pesos which will differ depending on what credit card company you will apply in. In compliance with the circular issued by BSP, there is a limit of 200 pesos for the cash advance fee. With this, no matter how much you withdraw, 200 pesos will be the fixed cash advance fee.
The question is, is the BSP Circular beneficial? For credit card holders like you, yes, it is very beneficial. The central banks put a cap on the amount that credit card companies can charge you which is very helpful during these times that an online form of payment is very much needed. Also, repayments will be very much easier due to the adjusted and decreased rates. Consequently, credit card companies and banks will make adjustments to their requirements. This includes imposing stricter qualifications and additional documentary requirements for new applicants, reducing credit card limits because of the lowering of interest rates and other fees, limiting the zero installment company features, and shortening the repayment terms for transactions that are on an installment basis.
Despite all of these conditions, this does not indicate that you will not be able to acquire credit. If you are desperate for an immediate loan, companies like Robocash would be an excellent alternative for you.
Loan requirements are very simple. As long as you are a citizen of the Philippines, have a valid government ID, 21-70 years old, employed or active in your profession, and have a working mobile number, then you are qualified to borrow from Robocash. You can borrow as low as 25,000 pesos which is payable in 30 days.
Moreover, you can apply for the Robocash loan in the comforts of your home and receive it within minutes anywhere, anytime.
But no matter how easy it is to get a loan from online lending platform, do not forget that loans must be returned on time, and borrowing is only done during extreme cases.
And on a final note, also always remember that no matter how difficult things are today, this will all pass!