Section 1904 - Rates of service charge on accountsSubject to the other provisions of this article, the seller or holder of a retail installment account may charge, receive and collect the service charge authorized by this act. The service charge shall not exceed the following rates computed on the outstanding balances from month to month:
(a) On the outstanding balance, a rate which is agreed upon by the seller or holder and the buyer.(b) A minimum service charge of fifty cents (50¢) per month may be made for each month if the service charge so computed is less than that amount; such minimum service charge may be imposed for a minimum period of six months.(b.1) Notwithstanding the rate provided for in clause (a), no issuer of a credit card primarily engaged as a seller or distributor of gasoline shall be permitted to charge, receive or collect a service charge in excess of fifteen percent (15%) simple interest per annum on unpaid balances.(b.2) Notwithstanding the rates provided for in clause (a), no bailor or lessor of goods shall be permitted to charge, receive or collect a service charge in excess of eighteen percent (18%) simple interest per annum on unpaid balances in a contract under which the bailee or lessee: (1) agrees to pay as compensation for use of the goods a sum substantially equivalent to or in excess of the value of the goods; and (2) has an option to become the owner of the goods for no additional or nominal additional consideration. This clause shall not apply to a rental-purchase agreement as defined in 42 Pa.C.S. § 6902 (relating to definitions).(c) The service charge may be computed on a schedule of fixed amounts if as so computed it is applied to all amounts of outstanding balances equal to the fixed amount minus a differential of not more than five dollars ($5), provided that it is also applied to all amounts of outstanding balances equal to the fixed amount plus at least the same differential.1966, Special Sess. No. 1, Oct. 28, P.L. 55, art. IX, § 904. Amended 1982, March 25, P.L. 199, No. 68, § 7, imd. effective. Reenacted 1985, March 1, P.L. 2, No. 2, § 1, imd. effective; 1988, Feb. 26, P.L. 78, No. 15, § 4, imd. effective; 1989, July 11, P.L. 573, No. 57, § 4, imd. effective; 1991, Feb. 21, P.L. 1, No. 1, § 3, imd. effective. Subsec. (a) reenacted 1994, May 27, P.L. 253, No. 39, § 2, imd. effective. Amended 1996, Dec. 20, P.L. 1519, No. 197, § 1, imd. effective.