BANKARD, INC. v. LUZ P.

ALARTE
G.R. No. 202573, April 19, 2017

Facts:

Petitioner, a duly constituted domestic corporation doing business as a credit card provider, filed a
collection case against respondent Luz P. Alarte before the Metropolitan Trial Court. Petitioner alleged
that respondent applied for and was granted credit accommodations, availed herself of credit
accommodations by purchasing various products but failed and refuses to pay her obligations despite
her receipt of a written demand.

The Metc dismissed the complaint for lack of preponderance of evidence which was affirmed by the RTC
and CA.

Issue:

Whether or not credit card arrangements are simple loan arrangements

Held:

Credit card arrangements are simple loan arrangements between the card issuer and the card holder.

Simply put, every credit card transaction involves three contracts, namely: (a) the sales contract
between the credit card holder and the merchant or the business establishment which accepted the
credit card; (b) the loan agreement between the credit card issuer and the credit card holder; and lastly,
(c) the promise to pay between the credit card issuer and the merchant or business establishment.2

securing the loan as indirect; names petitioner as the benefactor of the indirect loan; and states that the
requirements of the law were not complied with. It contains all the required elements for a violation of
Section 83, even if petitioner did not secure the loan in his own name.