Is Lending Money Illegal In The Philippines?

No, lending money is not illegal in the Philippines. However, there are regulations in place to protect borrowers and ensure the legitimacy of lending activities. Here’s a breakdown:

• Legal Lending:

  • Lending money can be a legitimate business activity in the Philippines.
  • Banks, microfinance institutions, and SEC-registered lending companies all operate legally.

• Regulations:

  • The Securities and Exchange Commission (SEC) regulates lending companies in the Philippines.
  • This ensures lenders follow specific guidelines regarding:
    • Registration requirements
    • Fair lending practices
    • Transparency in interest rates and fees

• Illegal Lending:

  • Lending money without following the regulations is illegal. This includes:
    • Loan sharks: Individuals or groups who lend money at exorbitant interest rates and often use aggressive collection tactics.
    • Unregistered lending companies: Companies that offer loans without SEC registration.