Using your credit card: know your rights and responsibilities
Your responsibility when cancelling a credit card
To cancel a credit card, you must contact your credit card issuer. Simply cutting up the card or not using it won’t cancel the credit card account.
Your rights when using credit card cheques
Federally regulated financial institutions must get your express consent before providing you with credit card cheques. If you consent verbally, they must send you written confirmation of your consent. You must receive it no later than the date of the first credit card statement provided after you consented.
When you use a credit card cheque, the expense is applied directly to your credit card account. You start paying interest as soon as you use them.
Using the credit card or any other related service doesn’t count as consent to receive unsolicited credit card cheques.
Your protection against unauthorized credit card transactions
When someone makes an unauthorized transaction with your credit card, your maximum liability, by law, is $50. Your credit card agreement must explain your maximum liability if someone used your card without your permission.
Visa, Mastercard and American Express have committed to protect you against financial loss. That is, if someone makes an unauthorized transaction with your credit card. According to this public commitment, they won’t hold you responsible or charge any fees for the unauthorized transactions.
Your rights related to credit card balance insurance
Credit card balance insurance or balance protection is an optional product. It may cover the payments, or part of the payments due on your credit card. This is only under specific conditions, such as if you become sick, disabled or die. Federally regulated financial institutions that offer this insurance must obtain your express consent before providing this product to you.
There are important exclusions on the coverage that credit card balance insurance provides.
Your right to information about credit card balance insurance
Federally regulated financial institutions must provide you with:
- a description of the product
- how long the agreement will last
- information about the cost of the product
- how you may cancel the product
Banks must provide you with this information before entering into an agreement with you.
More information about credit card balance insurance
Banks that are members of the Canadian Bankers Association (CBA) have adopted a code of conduct for authorized insurance activities. They commit to provide clear and understandable disclosure. This applies to documents related to authorized insurance products, including credit card balance insurance.
Banks will provide each customer accepted for insurance coverage with disclosure documents that set out:
- that the product you’re applying for is an insurance product
- the key terms and definitions related to the insurance
- all fees and charges associated with the insurance product, and how you must pay them
- that insurance coverage from a specific company is optional if they charge you for it separately
- the name of the primary insurance company underwriting the insurance product
- how and when they’ll notify you if they accept or reject your insurance coverage
- when the insurance coverage would come into effect and when it would end
- how long is the “free look” period, during which they refund all your premiums if you decide to cancel the coverage
- your responsibilities
- your right to cancel the coverage at any time
- the terms and conditions that might limit or exclude coverage
- how the claims procedures work
- how to get more information about the coverage
Banks will make this commitment available:
- at each of their branches in Canada where they offer products or services and at each of their points of service
- on each of their websites through which they offer products or services in Canada
- in writing, upon request
Your rights when dealing with debt collectors
A federally regulated financial institution might contact you about a debt you owe on your credit card. When they do, you have rights with respect to how they collect the debt. This also applies to any party acting on their behalf.
When these rights and responsibilities apply to you
These rights and responsibilities apply when you’re dealing with a federally regulated financial institution like a bank or federal credit union.
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