The credit card industry in the Philippines is heavily regulated to ensure that while banks have the right to collect what is owed, the dignity and privacy of consumers are protected. The primary governing framework for these practices includes the Philippine Credit Card Industry Regulation Law (Republic Act No. 10870) and various circulars issued by the Bangko Sentral ng Pilipinas (BSP), most notably BSP Circular No. 1122.

1. The Right to Collect vs. The Prohibition of Harassment

Under Philippine law, credit card issuers and their third-party collection agencies have the legal right to demand payment. However, this right is not absolute. The law strictly prohibits the use of unfair, deceptive, and abusive practices.

Prohibited Acts of Harassment:

Threats of Violence: Any threat of physical harm against the debtor, their family, or their property.
Obscene Language: The use of profanity or insulting language to humiliate the debtor.
Disclosure of Information: Revealing the debtor’s name or details to the public (e.g., "shaming" on social media or posting a list of delinquent borrowers).
False Representation: Falsely claiming to be a lawyer, a court official, or a government representative to intimidate the debtor.
Threats of Arrest: Claiming that the debtor will be imprisoned for non-payment of a credit card debt. In the Philippines, the Constitution prohibits imprisonment for debt, provided there is no fraud or "estafa" involved.

2. Contact Guidelines and Privacy

Regulatory bodies have set specific "windows" and methods for contacting debtors to prevent undue stress and intrusion.

Reasonable Hours: Debt collectors may only contact debtors between 6:00 AM and 10:00 PM, unless the debtor has given express consent to be contacted at other times.
Confidentiality: Under the Data Privacy Act of 2012, banks must keep the debtor's information confidential. They cannot contact a debtor's employer, friends, or neighbors to discuss the debt, except to locate the debtor's whereabouts if they have become unreachable.
Identification: Collectors must clearly identify themselves and the agency or bank they represent at the beginning of the communication.

3. Interest Rates and Finance Charges

A common point of contention in credit card debt is the "spiraling" of interest.

BSP Interest Rate Cap: As of current regulations, the BSP has imposed a ceiling on credit card interest rates (currently capped at 3% per month or 36% per annum).
Transparency: Banks are required to provide a clear breakdown of all finance charges, late payment fees, and penalties in the monthly billing statement.

4. The Role of Third-Party Collection Agencies

Banks often outsource the collection of "delinquent" accounts to agencies. It is a common misconception that these agencies operate under different rules.

Vicarious Liability: The principal bank remains legally responsible for the actions of its third-party collectors. If an agency violates the law, the bank can be held liable for administrative sanctions.
Written Notice: Before an account is endorsed to a collection agency, the bank must provide the debtor with a written notice at least seven (7) days prior to the actual endorsement.

5. Legal Remedies for Debtors

If a debtor feels that the collection practices have crossed the line into harassment or violation of privacy, several avenues for recourse exist:

BSP Consumer Protection Department: The primary regulator for banks. Debtors can file formal complaints through the BSP’s online webchat or email.
National Privacy Commission (NPC): If the collector discloses debt information to third parties or posts it online, a complaint for violation of the Data Privacy Act can be filed.
Civil Action: Debtors may sue for damages under the Civil Code of the Philippines if the harassment has caused significant mental anguish or damage to reputation.

6. Small Claims Court and Civil Liability

While a debtor cannot be jailed for purely failing to pay a credit card bill, they can be sued civilly.

Small Claims: For debts not exceeding P1,000,000.00 (exclusive of interest and costs), banks may file a case in the Small Claims Court. This is a summary proceeding where lawyers are not allowed to represent parties during the hearing.
Writ of Execution: If the bank wins the civil case, the court may issue a writ to garnish the debtor’s bank accounts or levy their non-exempt properties to satisfy the debt.

Summary of Debt Collection Standards

Practice	Legal Status
Calling at 2:00 AM	Prohibited
Threatening "Estafa" (for simple non-payment)	Deceptive/Prohibited
Contacting the debtor's HR department	Prohibited (Privacy Violation)
Filing a Civil Case in Small Claims	Allowed
Charging 10% interest per month	Prohibited (Exceeds BSP Cap)