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Bill wants additional charges for credit card users scrapped

Paolo Romero - The Philippine Star
Bill wants additional charges for credit card users scrapped
Senate Bill 296 seeks to penalize business establishments that charge more to customers who do not pay cash, but instead use their credit cards for goods or services “not only to protect citizens from unscrupulous practices of erring businesses,” but also to strengthen their rights that will “lead to more consumer confidence and thus more robust consumer spending a prime driver of our economy,” according to Escudero.
Philstar.com / File

MANILA, Philippines — Stores and businesses will no longer be allowed to charge customers more for goods and services if they use their credit cards instead of paying cash, if a bill filed by Sen. Francis Escudero is passed.

Senate Bill 296 seeks to penalize business establishments that charge more to customers who do not pay cash, but instead use their credit cards for goods or services “not only to protect citizens from unscrupulous practices of erring businesses,” but also to strengthen their rights that will “lead to more consumer confidence and thus more robust consumer spending – a prime driver of our economy,” according to Escudero.

“The use of credit cards by consumers has become wider over the years. However, this has not been without its challenges. In particular, it has been the practice of some merchandising stores and service establishments to charge a different, albeit higher price, for items bought using credit cards, or to limit bargain sale items and services to those made with cash purchases,” the senator said in his bill.

He noted that such a practice means that merchants are passing on the cost of processing fees charged to them by credit card companies to the consumers.

“This not only burdens consumers, but, in fact, discriminates against those who cannot pay in cash upon purchase. But whether or not a consumer chooses to pay in cash or charge, he or she should only pay the price indicated in the price tag – no distinction should be made as to the mode of payment. Such is the right of the consumer,” Escudero said, stressing that he proposed the measure to level the playing field.

While the senator acknowledged the right of big businesses to take the necessary steps to ensure profitability, the senator pointed out that “this should never be taken to mean that consumers shall bear the burden of these enterprises in doing business.”

“The consumer, as they say, is king. This measure intends to help big businesses understand and accept this fact,” he said.

Section 1 of the bill states: “It shall be unlawful for any merchandising store or service establishment to charge the customers more than the actual cash retail price of the goods and services purchased when such purchase is done with the use of a credit card and/or to limit bargain sale items and services to cash purchases.”

Under the measure, any person who shall violate the provision shall be punished with imprisonment of not less than six months, but not more than one year, or a fine of not less than P20,000 but not more than P100,000 or both at the discretion of the court.

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