Getting a credit card: know your rights
When you apply for a credit card, you enter into an agreement. It gives you and the credit card issuer rights and responsibilities. The following rights apply if your card issuer is a federally regulated financial institution.
If you give verbal consent to getting a credit card, federally regulated financial institutions must provide you with confirmation, in writing, without delay.
You may have received a credit card for which you didn’t provide consent. If so, contact the financial institution that provided this card to resolve the issue.
If they don’t resolve the issue, contact the Financial Consumer Agency of Canada (FCAC) for information.
Your right to information when getting a credit card
Federally regulated financial institutions must follow certain rules regarding your credit card agreement. This makes it easier for you to understand the terms and conditions.
This applies when:
- you apply for a credit card
- you get your credit card
- you receive your credit card statement
- your credit card agreement changes
Information when applying for a credit card
When you apply for a credit card with a federally regulated financial institution, they must provide you with information.
They must clearly set out the key features of the credit card in an information box. This box must be at the beginning of:
- the application form, or
- a separate document that comes with it
This includes information such as the card’s interest rates and other charges such as annual fees.
Banks must disclose this information in a single prominently displayed information box.
When you apply for a credit card, you agree to accept all the terms and conditions. This includes interest rates and fees. Ask questions if anything is unclear or if you’re not sure about what you’re signing.
Information with your credit card
When you receive your credit card, it must have a credit card agreement with it. Read the agreement carefully to understand your responsibilities and the terms and conditions of the card. Keep the agreement for your records. If there’s something you don’t understand, contact your financial institution.
Like the credit card application, your credit card agreement must have an information box that clearly outlines key information.
This information box may be at the beginning of:
- the agreement, or
- a separate document that you receive at the same time as the agreement
Banks must present this information in a single prominently displayed information box.
Information in your credit card statement
Once you have your credit card, your issuer must send you a statement, at least once a month. They must send it after the last day of each billing cycle. It may be in paper or electronic format (if you consent to receive information this way).
The statement includes information such as:
- the period covered and the opening and closing balances in the period
- the annual interest rate that applied on each day in the period and the total interest charged under those rates in the period
- the credit limit and the amount of credit available at the end of the period
- the minimum payment and its due date
- your rights and obligations regarding any billing error that may appear in the statement of account
- a local or toll-free telephone number, or a telephone number that clearly indicates it accepts collect calls. This is so you can get information about the account during the bank’s regular business hours.
- the amount you must pay by a due date to get the interest-free grace period
- a description of each transaction made during the period covered by the statement, and the amount credited or charged
- the date they posted each transaction to your account
You may not get a monthly statement if there haven’t been any advances or payments and:
- there’s no unpaid balance at the end of the period, or
- you’ve defaulted on your payments, and they suspended or cancelled your credit agreement and demanded payment of the unpaid balance
You might only get a statement every 3 months if:
- there haven’t been any advances or payments
- the unpaid balance is less than $10
- no fee or interest is being charged or accumulated
Information when your credit agreement changes
Your federally regulated financial institution may make changes to the features or the terms and conditions of your credit card. If so, they must provide you with the details of these changes in writing. They must do so at least 30 days before the changes take effect. The information may be in paper or electronic format (if you consent to receive information this way).
Your federally regulated financial institution must also get your express consent before raising your credit limit. If you agree verbally to an increase, they must confirm the change in writing. They must do so no later than when you receive your next credit card statement.
Exceptions to advance notice when your credit agreement changes
Some changes don’t require advance notice. Your federally regulated financial institution must disclose them in the next statement you receive after the changes.
- a change in the credit limit
- an extension of your grace period
- a decrease in the interest rate
- a decrease in non-interest charges or default charges
- a change concerning information about any optional service
- a change in the base rate linked to the variable interest rate (also known as the reference rate). This is if you have a card with a variable interest rate
Your right to receive electronic alerts
Your bank must send you electronic alerts in 2 situations:
- when the balance of your chequing or savings account falls below $100 or an amount you’ve set
- when the credit available on your credit card or personal line of credit falls below $100 or an amount you’ve set
Your bank will automatically set the electronic alerts to $100. You may ask your bank to set them to a different amount.
The alerts must tell you:
- that the balance of your account has fallen below the amount described above
- that the credit available on your credit card or line of credit has fallen below the amount described above
- what charges or penalties may apply to current or future transactions
- what steps to take to avoid charges or penalties and the deadline for doing this
Your bank will send these alerts to you automatically. You don’t have to sign up, but you may opt out at any time by informing your bank in writing. This could be done by email.
The alerts don’t apply to accounts opened for business purposes.
Your bank will send the alerts via push notifications, text messages or emails. It will depend on your contact information with the bank, the preferences you’ve set-up and the systems your bank has in place.
You won’t receive the new alerts if you didn’t provide your bank with the necessary contact information. For example, you didn’t provide your mobile phone number or email address.
For more information on electronic alerts, contact your bank or visit their website.
Other financial institutions may choose to offer electronic alerts. Contact yours to find out if they offer them.
Your rights as a joint borrower on a credit card
You may have a credit card as a co-borrower or joint borrower. Before you co-sign for a credit card with another person, you must understand what you’ll be responsible for.
If you co-sign for a credit card with one person or more, you are joint borrowers. Federally regulated financial institutions must give all of you copies of the credit agreement and statements. You may give up the right to receive this information by providing consent verbally or in writing (paper or electronic format).
You may have a credit card as an additional cardholder or authorized user.
When these rights apply to you
These rights apply when you’re dealing with a federally regulated financial institution like a bank or federal credit union.
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