Credit Card Interest Rates and Other Fees in the Philippines for 2022

Venus Zoleta

Venus Zoleta

Last updated August 19, 2022

Here's a great reason to get a credit card this year: The Bangko Sentral ng Pilipinas (BSP) has kept the maximum interest rate on unpaid outstanding credit card balances at 2% per month or 24% per year, while the maximum processing fee for credit card cash advances will remain at ₱200 per transaction.[1]

The cap on credit card interest rates and fees will give Filipinos reprieve from financial difficulties during these challenging times. If you're an existing cardholder, it's a good opportunity to pay down your credit card debt.

Whether you're planning to apply for a new credit card or you're currently carrying one, here's what you should know about the newly imposed restrictions on credit card interest rates in the Philippines.

What is a Credit Card Interest Rate?

The credit card interest rate is what credit card providers charge you for the privilege of borrowing money.[3] If you paid less than your monthly due amount, your credit card company would charge interest on the unpaid balance. You’ll incur interest until you fully pay off your credit card’s outstanding balance.

Credit card providers in the Philippines compute interest rates based on a 30-day period. The interest rate will decrease or increase accordingly for months that have less than or more than 30 days.

Note that credit card transactions can still be charged interest even if you’ve already paid in full. Some of these are cash advances and quasi-cash transactions (foreign currency or items that can be converted to cash like lottery tickets, money orders, gaming chips, etc.). That’s why it’s important to read your credit card provider’s terms and conditions to know which transactions you’ll be charged interest in.

How to Compute Credit Card Interest

interest of credit card - how to compute credit card interest

To show you how to compute the interest of your credit card, let’s use this example:

  • Current statement date: July 1, 2022
  • Next statement date: August 1, 2022
  • Previous balance: ₱10,000
  • Payment due date: July 21, 2022
  • Payment date: July 21, 2022
  • Payment amount: ₱5,000

Sample Credit Card Interest Computation

1. Add the number of days after your current statement date (July 2) to the day before your payment due date (July 20). That's a total of 19 days.

Next, multiply your previous balance by 19 days.

₱10,000 x 19 days = ₱190,000

2. Add the number of days from your payment due date (July 21) to your next statement date (August 1), which is a total of 12 days. Deduct your payment from your previous balance and multiply it by 12.

₱10,000 - ₱5,000 x 12 days = ₱60,000

3. Add the number of days from your previous statement date (June 1) to your current statement date (July 1), which is 30 days.

And then add the balances from the two previous steps and divide them by the number of days from the previous to the current statement date (30 days).

₱190,000 + ₱60,000 / 30 days = ₱8,333.33

Your total finance charge for your current statement date is ₱8,333.33. Multiply it by the monthly interest rate of 2%.

The total interest incurred for your current billing cycle is ₱166.66. Add your remaining balance of ₱5,000. The current charge you'll see on your next statement date is ₱5,166.66.

What is the Cap on Credit Card Interest Rates and Fees?

The BSP issued Circular No. 1098,[2] which sets the maximum credit card interest rates and fees in the Philippines. All BSP-regulated banks are mandated to implement the new rates starting November 3, 2020.

The cap on credit card interest rates and other fees will be reviewed by the BSP every six months. So expect that the figures might change depending on the country's current economic condition.

2% Credit Card Interest Rate Cap

Under the BSP Circular, credit card providers can charge only up to 2% monthly finance charge (or 24% annual interest rate) on the cardholder's unpaid outstanding balance. The credit card interest rate cap applies to straight payments and cash advances.

Previously, the average interest of credit cards in the Philippines was 3.50% per month or 42% per year. With the BSP-imposed limit, credit card interest rates have decreased by around 1.50 percentage points monthly or 18 percentage points yearly.

In addition to lowering their credit card interest rate to 2%, banks are also required to share with their clients a detailed yet simple, easy-to-understand explanation of how they compute their fees and charges.

1% Credit Card Installment Rate Cap

A separate interest rate cap will be charged on installment plans, including balance transfer and balance conversion. For such installment payments, banks can charge only up to a 1% monthly add-on rate.

₱200 Credit Card Cash Advance Fee Cap

When you make a cash advance, you'll be charged a fixed fee of only up to PHP 200 per transaction. According to the BSP, no other charges should be collected on credit card cash advances except for that flat fee.

Updated Interest of Credit Cards in the Philippines 2022

interest of credit cards - credit card interest rate philippines

Complying with the BSP-mandated cap on interest rates and other fees, most commercial banks in the Philippines have announced their respective new rates.

Some banks increased their late payment and overlimit fees, apparently to offset lost opportunity costs due to the compulsory lower interest rates.

Below are the updated tables of fees and interest of credit cards in the Philippines,[3] at least for 2022. Credit card fees that are not included in the tables remain the same.

AUB Credit Card Interest Rates and Fees

AUB Credit Card Fees New Rates Effectivity Date
Monthly interest rate 2% March 1, 2021
Installment add-on interest rate 1% March 1, 2021
Late payment fee
  • ₱250 for weekly payment option 
  • ₱500 for semi-monthly payment option 
  • ₱1,000 for monthly payment option or the unpaid minimum amount due, whichever is lower
March 1, 2021
Compare AUB credit cards

Related article: Credit Cards with No Annual Fees in the Philippines

Bank of Commerce Credit Card Interest Rates and Fees

Bank of Commerce Credit Card Fees New Rates Effectivity Date
Monthly interest rate 2% November 3, 2020
Cash advance fee ₱200 per transaction November 3, 2020
Late payment fee ₱1,000 or the unpaid minimum amount due, whichever is lower November 3, 2020
Overlimit fee ₱500 November 3, 2020
Installment pre-termination fee ₱1,000 November 3, 2020

Compare Bank of Commerce credit cards

BPI Credit Card Interest Rates and Fees

BPI Credit Card Fees New Rates Effectivity Date
Monthly interest rate 2% November 3, 2020
Special Installment Plan (S.I.P.) pre-termination fee ₱550 + 2% of the loan principal amount or applicable interest of the next monthly payment July 2022
Late payment fee ₱850 or the unpaid minimum amount due, whichever is lower July 2022
Cash advance interest rate 2% November 3, 2020
Cash advance fee ₱200 per transaction November 3, 2020
Compare BPI credit cards

China Bank Credit Card Interest Rates and Fees

China Bank Credit Card Fees New Rates Effectivity Date
Monthly interest rate 2% November 3, 2020
Late payment fee ₱750 or the unpaid minimum amount due, whichever is lower December 2021
Foreign transaction fee 2.5% December 2021
Quasi-cash fee ₱200 December 2021
Installment pre-termination fee ₱500 or 5% of the remaining unpaid installment balance, whichever is higher December 2021
Cash advance fee N/A N/A

Citibank Credit Card Interest Rates and Fees

Citibank Credit Card Fees New Rates Effectivity Date
Monthly interest rate 2% November 3, 2020
Cash advance interest rate  2.04% (inclusive of ₱200 cash advance fee) November 3, 2020
Late payment fee (not applicable to Citi Simplicity+) ₱1,500 or the unpaid minimum amount due, whichever is lower January 8, 2021
Overlimit fee (not applicable to Citi Simplicity+) ₱1,500 or the highest overlimit amount during the billing period, whichever is lower January 8, 2021
Citi Balance Transfer and Speed Cash processing fees ₱900 per approved transaction October 30, 2020
Citi FlexiBill processing fee ₱750 per approved transaction October 30, 2020
Citi PayLite processing fee ₱250 per approved after-purchase transaction October 30, 2020

Note: These products are sold by Union Bank of the Philippines, using certain trademarks temporarily under license from Citigroup Inc. and related group entities.

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 Apply for a Citibank credit card

EastWest Credit Card Interest Rates and Fees

EastWest Credit Card Fees New Rates Effectivity Date
Monthly interest rate 1.99% to 2% November 3, 2020
Cash advance interest rate 1.99% to 2% November 3, 2020
Cash advance fee ₱200 per transaction November 3, 2020
Minimum amount due ₱200 or the sum of 3% of total balance + overdue amount + overlimit amount, whichever is higher January 15, 2021
Late payment fee ₱1,500 or the unpaid minimum payment due, whichever is lower June 18, 2021
Compare EastWest credit cards

HSBC Credit Card Interest Rates and Fees

HSBC Credit Card Fees New Rates Effectivity Date
Monthly interest rate 2% November 3, 2020
Cash advance interest rate 2% November 3, 2020
Cash advance fee ₱200 per transaction November 3, 2020
Minimum amount due ₱500 or the sum of 1% of the full current amount owed + 1/12 of the annual fee + 100% of monthly installment amount and any past due amount, overlimit amount, and late charge, whichever is higher February 28, 
HSBC Installment Plan pre-termination processing fee ₱500 December 2020
Late payment fee ₱1,000 or unpaid minimum amount due, whichever is lower March 1, 2021
Overlimit fee ₱800 March 1, 2021
Apply for an HSBC credit card
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Maybank Credit Card Interest Rates and Fees

Maybank Credit Card Fees New Rates Effectivity Date
Monthly interest rate 2% November 3, 2020
Cash advance fee ₱200 per transaction November 3, 2020
Late payment fee ₱850 or unpaid minimum amount due, whichever is lower May 3, 2021
Overlimit fee ₱750 May 3, 2021
Compare Maybank credit cards

Metrobank Credit Card Interest Rates and Fees

Metrobank Credit Card Fees New Rates Effectivity Date
Monthly interest rate 2% November 3, 2020
Balance Transfer, Cash2Go, and Balance Conversion fees 1% monthly add-on rate November 3, 2020
Cash advance fee ₱200 per transaction November 3, 2020
Late payment fee ₱1,000 or unpaid minimum amount due, whichever is lower June 1, 2021
Compare Metrobank credit cards

RCBC Credit Card Interest Rates and Fees

RCBC Credit Card Fees New Rates Effectivity Date
Monthly interest rate 2% November 3, 2020
Late payment fee ₱850 or the unpaid minimum amount due, whichever is lower November 3, 2020
Balance transfer fee ₱250 November 3, 2020
Overlimit fee ₱600 November 3, 2020
Cash advance fee ₱200 November 3, 2020
Apply for an RCBC credit card

Robinsons Bank Credit Card Interest Rates and Fees

Robinsons Bank Credit Card Fees New Rates Effectivity Date
Monthly interest rate 2% November 3, 2020
Late payment fee ₱750 November 3, 2020
Overlimit fee ₱750 November 3, 2020

Compare Robinsons Bank credit cards

Security Bank Credit Card Interest Rates and Fees

Security Bank Credit Card Fees New Rates Effectivity Date
Monthly interest rate 2% November 3, 2020
Balance Transfer, Ready Cash, Balance Convert, Convert to ChargeLight, and SimplyPay 1% monthly add-on rate across all tenors November 3, 2020
Cash advance fee ₱200 per transaction (Peso accounts) / USD 4 per transaction (Dollar accounts) November 3, 2020
Late payment fee ₱1,000 or unpaid minimum amount due, whichever is lower August 30, 2021
Minimum amount due ₱500 or 3% of the total amount due, whichever is higher (Peso accounts) / US$ 10 or 3% of the total amount due, whichever is higher (Dollar accounts) January 25, 2021
Quasi-cash fee (new service fee on gaming/gambling transactions) 2.5% of the transacted amount January 25, 2021
ChargeLight Plan pre-termination fee 5% of the unbilled portion of the principal amount February 1, 2021
Returned check fee ₱1,250 / US$ 25 per returned check February 1, 2021
 SOA retrieval fee ₱50 per page if requested billing statement is from three months or more ago February 1, 2021
Compare Security Bank credit cards

UnionBank Credit Card Interest Rates and Fees

UnionBank Credit Card Fees New Rates Effectivity Date
Monthly interest rate 2% November 3, 2020
Cash advance fee ₱200 November 3, 2020
Late payment fee  ₱1,000 November 3, 2020
Overlimit fee ₱500 November 3, 2020

Read more: What You Need to Know About UnionBank Credit Card Fees

Apply for a UnionBank credit card

5 Tips to Avoid Being Charged a Credit Card Interest Rate

interest of credit card - how to avoid being charged

Given the option to pay something in full or in several smaller payments, the latter sounds more appealing, especially if the item has a high price tag. To avoid hefty credit card charges in the Philippines, you must keep the following tips in mind.

1. Pay Your Credit Card in Full

One of the perks of owning a credit card is the convenience of paying for purchases over a period of time. But if you carry your credit card balance from month to month, you end up paying more. You’ll accumulate interest charges until you fully pay off your credit card balance.

Pay off your credit card in full, so you won’t have to carry the balance to the next month. And while you haven’t fully settled your outstanding balance, try not to make any more credit card purchases to reduce the amount you owe.

2. Pay More Than Your Minimum Amount Due

If you pay more than the minimum amount due, you’re also decreasing the interest you’ll need to pay in the longer term. Also, your credit card won't be maxed out, improving your credit utilization ratio.

3. Read Your Credit Card’s Terms and Conditions

Before you swipe, make sure you understand how your credit card issuer will charge you for a particular purchase or transaction. The terms and conditions will fully explain how your credit card balance will be calculated and what the interest rates and charges are.

4. Avoid Making a Cash Advance

A cash advance isn’t the same as a cash withdrawal from an ATM. The moment you make a cash advance on your credit card, the interest starts adding up. Avoid borrowing from your credit card limit unless it’s a real emergency, and you can pay the amount ASAP.

5. Reduce Your Credit Card Balance

If your current financial situation doesn’t allow you to fully pay off your credit card, reduce your credit card balance at least. Pay it down to avoid hefty interest. More importantly, resist the temptation of making new credit card purchases for now if you can’t pay them in full.

Final Thoughts

The credit card interest rate cap is a big help for cardholders in the Philippines during this difficult time. It will allow you to pay off your credit card fast and borrow cash using your card at a cheaper cost for a financial emergency.

If you don’t own a credit card yet, do a credit card comparison in the
Philippines to find the best credit cards and which offers the lowest credit card interest rate.

To get the most benefits of a lower interest of credit cards, maintain your good credit standing—avoid maxing out your limit, pay your bills in full and on time, and use your card responsibly.

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Sources:

Venus leads the blog content strategy and optimization at Moneymax as the Head of Editorial Content. She has 15+ years of experience in content marketing, corporate communications, and public relations. Venus graduated cum laude with a Journalism degree from the University of the Philippines Diliman. Before joining Moneymax, Venus had written informative guides and articles, specializing in personal finance and digital marketing. She also invests in stocks, mutual funds, VUL, and Pag-IBIG MP2. A hardcore Hallyu Tita, she enjoys bingeing K-dramas on Netflix while bonding with her rescued cats. Follow Venus on LinkedIn.