Philippine Banking Culture Shock: Unsolicited Ready-to-Activate Credit Cards

After coming back home to the Philippines, I decided to open a bank account with Banco de Oro (BDO). I chose BDO because it has several branches and, in fact, there is one five minutes away from where I live. I first opened a Peso (PHP) account followed by a US dollar account a few months later. Since opening those accounts, my average combined balance did not exceed the equivalent of $3,000.

About 10 months after I opened the account, I was surprised to receive a ready-to-activate BDO credit card by courier. I did not apply for any such credit card. I had no intention of applying for any credit card since I am not currently working and these credit card applications require some form of employment certificate. I also still have active US credit cards that I can use.

In the US, it is common to receive offers for pre-approved credit cards in the mail, but one still has to complete an application and provide the required financial information. Receiving a pre-approved credit card offer does not guarantee approval.

The BDO credit card I received was ready to use after activation. It has a credit limit of PHP100,000. After a quick Google search, I read that this practice of sending unsolicited cards by Philippine banks has been explicitly banned by the Bangko Sentral ng Pilipinas (BSP):

BSP Clarifies Existing Regulations Prohibiting the Issuance of Pre-Approved Credit Cards


The Bangko Sentral ng Pilipinas (BSP), in its Resolution No. 1055 dated 02 July 2014, approved the issuance of a Circular to clarify existing regulations prohibiting the issuance of pre-approved credit cards, pursuant to BSP Circular No. 702, Series of 2010.

The Circular seeks to clarify what constitutes pre-approved credit cards. A pre-approved credit card is an unsolicited credit card issued by credit card issuers to consumers who have not applied for such credit card. “Application” has likewise been defined as a documented request of the credit card applicant to a credit card issuer for the availment of a credit card. The intention and consent for the availment of the credit card must be clear and explicit.

The Circular enumerates the acts tantamount to the act of issuing pre-approved credit cards. These include unsolicited calls by the bank to its depositors informing that they already have a credit card from its Credit Card Department due to good standing as a depositor or sending of unsolicited supplementary cards and other cards with added features which are not in replacement or substitute to an existing cardholder’s initial credit card. Moreover, some credit card issuers sought to legitimize the issuance of pre-approved credit cards by contract stipulations on the issuance of additional cards depending on the credit consumption and the payment history of the user. This practice shall be discontinued by having the provisions of the Circular prevail over any contrary stipulations in the contract.

Again, I never applied for any credit card so BDO sending me this card appears to be a clear violation of BSP policy. I nevertheless decided to activate the card because the first-year annual fee is waived. I’ll cancel the card if BDO would refuse to waive the annual fee of PHP2, 400 for succeeding years.

I am of two minds about this incident. On the one hand, it is nice to get a credit card without going through the hassle of applying for one. On the other hand, it is disappointing to see that the biggest bank in the country is actively flouting BSP rules with seeming impunity. I know I can handle my credit properly. There are those who cannot and may quickly find themselves with piling debt.

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