The ruling government in Thailand last week approved a draft Credit Card Business Act designed to protect consumers from abuses by credit card companies and to help tackle card debt problems. The proposed legislation now goes to the country's parliament for approval.
The act would apply a uniform set of standards to all credit card businesses, regardless of whether they are banks or nonbank financial institutions, according to local newspaper Bangkok Post. Holders of cards issued by nonbanks would be affected the most because the institutions typically charge higher fees and interest rates than do banks, whose fees are capped by Bank of Thailand regulations.
The act also would prohibit companies from charging holders annual fees for credit cards. Thailand currently has no specific law governing credit card businesses, and operators are required to comply with the Bank of Thailand’s regulations.
Card issuers also would be required to seek licenses from the Finance Minister, and the finance ministry would have the full authority to revoke their licenses if they breach the law.
The Justice Ministry and the Finance Ministry developed the new legislation jointly. Officials from both ministries declined PaymentsSource requests for comment.
If approved, the law would take effect by the end of September.
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