Credit card issuers balance caution with borrower support amid risks

Insider Spotlight

• Card issuers tighten screening amid global uncertainty
• Banks balance risk controls with customer relief programs
• BPI highlights proactive credit monitoring tools
• Rising fuel costs flagged as a pressure point for consumers
  
  
  

Philippine credit card issuers are bolstering risk management safeguards while continuing to support borrowers, as global and domestic pressures weigh on personal finances.

Industry players are adopting a twin approach—tighter underwriting and stronger customer engagement.

Keeping watch over external risks 

Alex Ilagan, private sector representative at the Credit Card Association of the Philippines (CCAP), said members are closely tracking developments in the evolving geopolitical situation in the Middle East and its implications for global economic conditions.

“As part of their routine risk management practices, members continue to reassess and recalibrate risk appetite parameters for new card applications,” Ilagan said.

As a result, some banks are becoming more selective, adjusting underwriting and credit exposure to preserve portfolio quality.

Alex Ilagan

Private sector representative, CCAP

Proactive engagement 

Alongside tighter controls on new accounts, issuers are also focusing on existing cardholders as consumers face higher expenses driven by rising fuel prices and the cost of goods.

CCAP said banks are “closely monitoring existing accounts and remaining responsive to cardmembers’ needs,” with issuers ready to proactively engage customers facing financial pressure by offering repayment and assistance arrangements.

Payment programs 

For its part, Bank of the Philippine Islands (BPI) outlined efforts to cushion the impact of these pressures for both the bank and its clients.

“For customers already in our portfolio, we have payment programs… you can keep using [credit cards] until you max out your credit limit,” said Jenny Lacerna, head of mass retail products at BPI.

Jenny Lacerna

Head of mass retail products, BPI

“We’re also being more cautious with credit line increases (ICL). And for customers showing some deterioration in behavior, we have proactive programs that we can offer,” she added.

Lacerna said these interventions have been timely, with customers “appreciative of the payment schemes offered to them.”

By staying defensive yet flexible, issuers are navigating an increasingly uncertain environment.

“Overall, the industry remains prepared, adaptive, and responsive to ever-changing economic and global developments,” Ilagan said. —Ramon C. Nocon | Ed: Corrie S. Narisma