The Philippine Securities and Exchange Commission (SEC) has urged Filipinos to borrow money only from registered lenders, warning that illegal operators may charge exorbitant interest rates and resort to unfair collection practices.
The corporate regulator said consumers should use safe, transparent and regulated credit products, including credit services offered through digital applications, and carefully consider the true cost of borrowing and their ability to repay.
As digital loans become increasingly accessible across the country, borrowers should understand their rights and review loan terms before accepting a loan, the SEC said.
The warning forms part of a financial literacy campaign aimed at helping consumers identify unlicensed lenders, avoid predatory lending and make informed borrowing decisions.
The campaign includes SEC-approved educational videos that explain financial concepts in simpler terms and provide guidance on identifying legitimate lenders and regulated credit options.
The SEC said the stigma associated with borrowing can sometimes discourage Filipinos from seeking formal loans and push them toward unlicensed lenders when they need financial assistance.
He added that consumer education, as well as regulatory enforcement, is necessary because illegal lenders may use misleading loan terms, excessive charges and abusive debt collection methods.
“The SEC will continue to use its regulatory and enforcement powers against violators. We must also empower the public with knowledge, awareness and critical thinking,” the SEC Commissioner said. McJill Bryant Fernandez Quevedo in question.
“An informed citizen is the first line of defense against fraud,” Quevedo added.
The regulator said responsible borrowing requires consumers to only deal with licensed providers, understand interest rates and other charges, assess repayment capacity and report suspicious lending activity.
The campaign also aims to raise awareness of data security risks associated with unregulated lending practices that can collect or misuse borrowers’ personal information.
Broader access to digital credit should be accompanied by stronger consumer protections and financial education to ensure borrowers can use formal lending services without falling into the debt trap, the SEC said.
The campaign was launched by Fuse Financing Inc., the lending arm of mobile wallet operator GCash. It is carried out with.
