Credit card issues make up a fourth of complaints filed

MANILA, Philippines — Credit card transactions accounted for a fourth of total consumer complaints, which reached 23,000 last year, according to the Bangko Sentral ng Pilipinas (BSP).

In a virtual press briefing, BSP Governor Benjamin Diokno said 25 percent of concerns from the public coursed through the central bank’s Consumer Assistance Mechanism (CAM) last year pertain to credit cards.

Diokno said an estimated 12 percent of the total complaints pertain to the implementation or availment of the mandatory grace period for loan and credit cards products under Republic Act 11469 or the Bayanihan to Heal as One Act (Bayanihan 1) and RA 11494 or the Bayanihan to Recover as One Act 2 (Bayanihan 2).

Banks adjusted their respective information technology (IT) systems to accommodate the loan payments moratorium under the Bayanihan laws.

“Data from the BSP shows that consumer complaints including credit card complaints increased in 2020 in terms of volume. In terms of overall ranking the top concern on credit card in 2019 involved disputed fees, while credit card fees and charges were the primary issue in 2020,” Diokno said.

Diokno said the complaints were referred to the senior management of concerned banks for appropriate actions.

Consumers were also encouraged to talk with their banks to come up with acceptable restructuring and repayment schemes.

Based on the BSP’s analysis, fraudulent common credit card transactions commonly involve information and identity theft, phishing and its variations, skimming as well as card replacement scam.

Diokno said the regulator continues to work closely with BSP-supervised financial institutions (BSFIs) and financial consumers to eradicate credit card-related fraud.

“The BSP underscores collective vigilance against frauds amid the increased accessibility of innovative digital financial products and services during the pandemic. This is seen to foster greater confidence in the financial system under the new economy,” Diokno said.

The BSP has issued a set of regulations mandating BSFIs to put in place stringent information technology security controls and sound risk management practices, and to adopt industry-standard technology like the multi-factor authentication system for online transactions.

It has also tightened the reporting requirements on cyber-related incidents and operational disruptions to ensure the protection of consumers should an actual attack take place.

“The BSP stands ready to deploy its full range of supervisory tools to foster market discipline and to protect the rights and interests of consumers in an expanding digital landscape,” Diokno said.

The BSP also noted the critical role of consumers in reducing their vulnerability to cyber risks, prompting the regulator to sustain its information campaign against credit card fraud through the central bank’s Digital Literacy Program.

Melchor Plabasan, director of the central bank’s Technology Risk and Innovation Supervision Department, said the regulator continues to assess the security protocols of BSFIs including credit card issuers vis-à-vis the BSP standards and regulations.