Two persons asked me this morning if they can be imprisoned for non-payment of their balance in the credit card.
The outstanding balance on credit cards is considered debt since the relationship between a credit card provider and its card holders is that of creditor-debtor, with the card company as the creditor extending loans and credit to the card holder, who as debtor is obliged to repay the creditor (Polo S. Pantaleon vs. American Express International, Inc.; G.R. No. 174269). In case of non-payment, the debtor generally incurs only civil liability. Further, every credit card holder is entitled to the provision of Bill of rights that “No person shall be imprisoned for debt or non-payment of a poll tax.”
The non-payment however would give rise to criminal liability if there is “deceit with intent to defraud” on the part of the delinquent credit card holder. Consequently, he can be held liable for estafa which carries the penalty of imprisonment. It is stemmed from the provisions of R.A NO. 8484 – Access Devices Regulation Act of 1998 (Sec. 14 (f ) par. 2) that:
“A cardholder who abandons or surreptitiously leaves the place of employment, business or residence stated in his application or credit card, without informing the credit card company of the place where he could actually be found, if at the time of such abandonment or surreptitious leaving, the outstanding and unpaid balance is past due for at least ninety (90) days and is more than Ten thousand pesos (P10,000.00), shall be prima facie presumed to have used his credit card with intent to defraud.”
Non-payment of debt will also establish a bad credit reputation. Chances are, you may find it difficult to acquire a loan that is an absolute necessity such as car loan, housing loan, etc.
So you better pay off your debts to save you from anxieties, harassing phone calls, court litigation and unnecessary inconvenience, stress and expenses.
The way of the superior person is threefold;
VIRTUOUS, they are free from anxieties;
WISE, they are free from perplexities; and
BOLD, they are free from fear’