The new face of loan sharks now in the Philippines are in the form of online lending apps (OLA) with advertisements proliferating in various digital platforms and luring financially-challenged Filipinos. The ease of mobile access and the widespread popularity of social media have paved the way for these opportunistic companies to infiltrate the lending industry and exploit borrowers facing financial hardships. These predatory online lending companies heavily spends on SocMed advertising prompting their prey to download the app, promising low interests rates and easy approval. Considered as a click-bait tactic, they have been luring online users to click a site or download an app through “low-interest” and “guaranteed approval” promises.
The ordinary course of a loan application goes through lengthy paper works and rigorous credit checks and investigations, and the loaner must wait for days for the approval. Now, these online lending apps offer fast and convenient loaning with just few taps on a smartphone. I was once actually tempted to try loaning from these online lending apps but have been prevented by some of the comments of actual loaners which surfaced OLA’s social media pages.
“Sobrang laki ng interest, ang nakalagay sa ad ay one year babayaran, pero within one week lang pala”. “Mataas din ang processing fee, yung 5,000 pesos na ni-loan ko, 3500 lang ang nakuha ko tapos need ko i-settle after one week”. These are some of the paraphrased comments I remember seeing while going through the social media pages of these OLAs. But it is not just the interest rate that is alarming for these OLA’s are proven to have harassment tactics reported by borrowers—pinapahiya sa social media, pinapadalhan ng bulaklak ng patay sa bahay, minumura ng mga collector, pinagbabantaan ang buhay, etc. –if they failed to settle their loan repayments.
These reported psychological abuse, privacy violations and severe life threats have prodded the authorities to raid an OLA company early this year. According to the National Privacy Commission and the PNP’s Anti-Cybercrime Group, the company was accessing borrower contact lists without consent and using intimidation tactics — a clear violation of data privacy laws and ethical lending standards.
As of this writing, these OLAs have switched to a different advertising message: “Hindi na namin kayo tatawagan, wala na kaming collection deparment, wala nang harassment na mangyayari, etc.” And their promise of easy approval and low interest rates still prevail in their ads which continuously attract economically-disadvantaged Filipinos. And yes, I believe that even after the recent raid, these online lending apps won’t simply disappear because they will just change names, and continue to prey on desperate borrowers — people who, sadly, often have no other choice but to fall into their trap.
Financially challenged Filipinos will continue to rely on these OLAs since they (especially low income earners) have been long battling what we call “financial exclusion” wherein they are deprived of access to legitimate credit sources like banks and other legal lending and financial institutions. And these OLAs are their last resort to solve financial constraints.
But the question is this: how do we get rid of these opportunistic loan sharks? Or shall we now call them what they truly are — loan devils, don’t you think? My fearless take? The eradication of these OLAs is far from reality — not as long as capitalism continues to triumph over the interests of society. Its saddening and somehow infuriating —[actually nanggigigil ako habang sinusulat ko ito]— that such a simple problem remains unaddressed by those in authority. If they can’t resolve something as simple as this, how can we expect them to solve bigger issues of corruption and financial fraud that we have here in our country? Kawawa ang mga ordinaryong Pilipino [Again, sigh….]
