Credit Card Charges

With ever increasing use of credit card in the Philippines, it is a good thing to let

everyone know what are the different charges and fees that go with it. Following are guides that may equip Filipinos with knowledge that will help them manage their credit card usage.

1.) Credit card annual fee - All credit card issuers charge this to cardholders for membership subscription. It is charged for every card a card holder avails. Which

means that if a person avails two credit cards, even from the same issuing bank, he

will be charged for two separate credit card annual membership fees. Credit card annual membership fees range from Php 1,200.00 to Php 2,000 or more.

The annual membership fee varies depending on the type of card. If the credit

card has more features than others, most likely it will have a higher annual fee.

2.) Credit card finance charge - In most loans, finance charge represents the cost of borrowing the lender's money. As a privilege of getting a loan, finance charge is impost

on every loan.However, with credit card usage, it is imposed only to card holders who fail to pay the minimum amount required. Which means that a cardholder will be charged even he pays on or before the due date. So, it is wise to always pay the minimum amount required. Taking into consideration that finance charges range from 5% to 6% per month.

3.) Penalty charges, also known as late charges are credit charges imposed when the borrower fails to pay the amount due before the allotted time. Credit card issuers usually have grace period before imposing late charges on their clients.

4.) Balance transfer fee is imposed when a card holder transfer unpaid outstanding balances from one credit card issuer to another. Balance transfer starts at 1% add on interest per month.

5.) Over the limit fee is charged to cardholders who exceeds the use of their credit card limit. So it is good to always check your balance before using your credit card. Credit card limit is always printed on the monthly credit card statement.

6.) Cash advance fee is a fee imposed once a card holder uses the cash advance facility. Cash advance fee starts at 4% of the amount advanced. A card holder is charged a cash advance fee for every transaction.

7.) Credit card replacement fee, is charged to a card holder every time a credit card is replaced. Credit card replacement fee starts at Php400.00 but can be waived if the card holder is a loyal customer of the issuing bank.

8.) Credit limit increase fee is impost when a card holder wishes to increase the spending limit of his credit card. However in the Philippines, only few credit issuers impost such fee as credit limit increase is given as privilege to loyal card holders.