Many users end up forgetting the importance of understanding how the credit card agreement works, not knowing it is always detrimental to your financial education. Before signing a credit card agreement, you need to be informed about all its clauses.
The credit card agreement is responsible for generating obligations between all parties involved.
How does the credit card agreement work?
Before hiring credit card you must understand that this legal relationship involves up to four parts. They are responsible for fulfilling some previously agreed obligations.
The parties involved in the credit card agreement are:
- Business establishment;
- Financial institution;
This operation is called the contractual system. It orders individual agreements between each party. That is, everyone has obligations to be fulfilled among themselves.
It is important to check the contract before joining so that the terms, interest and costs entered in it are analyzed. According to the Yes Savings Bank, it is designed as an intermediation service that allows consumers to purchase goods and services. This only occurs if these financial establishments are accredited and the user status is proven. This proof occurs at the time of credit card purchase. It is issued by the intermediary service provider, called the credit card administrator.
When the transaction occurs, the merchant registers it from the models to the administrator. This generates the debit to the user. From this perspective, all roles and actions are previously determined.
Card Contract Clauses
As it is legally presented as a membership contract, there is a standardization of its contractual clauses.
This means that the parties do not argue about the clauses as they are already determined in advance. The Consumer Protection Code is responsible for defining the principles and standards of this type of contract.
If the client wishes to discuss the legality of the agreement, he will need to bring legal action. This is because of the contract obeys the principles that govern the relationship of consumption.
Among the requirements of the credit card agreement are:
- Any constraints must be underlined;
- The information needs to be clear and accurate;
- Characters must be larger than size 12;
- Provisions that limit consumer rights should be highlighted (bold);
- It may have termination clauses, which determine occurrences that terminate the contract.
When can this contract be canceled?
Article 51 of the Consumer Protection Code classifies all conditions of contract cancellation. This means that the membership agreement that obtains such clauses is invalid and illegal. Some abusive conditions of the credit card agreement include:
- Annul the possibility of reimbursement;
- Transfer responsibilities;
- Give way to unilateral modification;
- They prove harmful to the consumer.
The consumer is considered the most fragile part of a contract. Therefore, any terms that are harmful to him are not accepted.