Below is a structured overview of “everything essential you need to know” on the topic in the Philippine context.

I. Big picture: Why lending apps are a legal flashpoint

Online lending apps (OLAs) and “instant cash” apps became popular because:

They disburse money quickly (often same day).
They ask for minimal documents, often just an ID and access to your phone.
They target people who are unbanked or underbanked and can’t access formal bank loans or credit cards.

But complaints typically arise when:

Interest and “service charges” balloon the obligation far beyond the amount borrowed.
Collection methods become abusive: public shaming, threats to family, workplace harassment.
Apps are unregistered or operating outside their license conditions.
Apps misuse personal data (e.g., scraping phone contacts and photos).

Borrowers then ask: Is this “usury”? Is this legal? Can I file a complaint and where?

II. The legal framework

1. The old Usury Law – and why “usury” is complicated today

Historically, the Philippines had a Usury Law (Act No. 2655) that capped interest rates. However:

The Central Bank / Bangko Sentral ng Pilipinas (BSP) issued circulars (notably the one often referred to as lifting interest ceilings) which suspended the effective ceilings on interest rates.
The Usury Law is not formally repealed, but the caps are no longer in force. In practice, parties are free to agree on interest rates.

However, the Supreme Court has consistently ruled that:

Courts can strike down or reduce interest rates that are “unconscionable,” “excessive,” or “contrary to morals and public policy.”
Even if the parties signed the contract, courts can remove or lower iniquitous interest, penalties, and charges.

So legally:

There is no fixed statutory interest cap (e.g., “anything over 36% per year is illegal”) for private loans;
But there is a case-law safety valve: courts may annul or reduce abusive rates.

2. Lending and financing regulation: SEC & BSP

There’s a crucial distinction:

Banks, quasi-banks, and some fintech companies → Regulated primarily by the BSP.
Lending companies and financing companies → Regulated by the Securities and Exchange Commission (SEC) under:
- Lending Company Regulation Act (R.A. 9474)
- Financing Company Act (R.A. 8556)
- Implementing rules and SEC circulars on online lending platforms (OLPs)

Key points:

Only corporations with an SEC license may operate as lending or financing companies (subject to minimum capitalization).
Lending and financing companies must secure a separate SEC Certificate of Authority to operate.
SEC has issued advisories, suspension orders, and revocations against erring lending apps, especially those:
- Without licenses
- With abusive collection practices
- With hidden charges or misleading advertisements

If a lending app is really just a front for an unlicensed individual or an unregistered entity, it can face cease-and-desist orders and criminal charges under these laws.

3. Financial consumer protection

Financial consumers are also covered by:

The Consumer Act of the Philippines (R.A. 7394)
The Financial Products and Services Consumer Protection Act (R.A. 11765) and its regulations
BSP, SEC, and the Insurance Commission (IC) have their own issuances on:
- Fair and transparent pricing
- Proper disclosure of loan terms
- Prohibition of unfair, abusive, or deceptive acts and practices

These rules apply differently depending on whether the lender is a bank/BSP-supervised or SEC-supervised entity, but the theme is the same: consumers must be treated fairly and informed adequately.

4. Truth in Lending

The Truth in Lending Act (R.A. 3765) requires creditors to clearly disclose to borrowers, in writing and before the transaction:

The true cost of credit in terms of:
- Annual interest rate (APR)
- Service charges
- Penalties
- Other finance charges
The total amount to be paid and the payment schedule

If an app hides the real cost of credit or misleads borrowers, there may be violations of R.A. 3765 and related regulations.

5. Data Privacy and cybercrime

Most abusive OLA practices are data-driven:

Apps often require permission to access:
- Contacts
- SMS
- Photos, camera, microphone
- Location
They may use this data to:
- Harass or shame borrowers,
- Send messages to friends, colleagues, and family.

Relevant laws:

Data Privacy Act of 2012 (R.A. 10173)
- Requires lawful, proportional, and transparent processing of personal data
- Requires valid consent and specified purposes
- Prohibits unauthorized disclosure and misuse of personal data
- Enforced by the National Privacy Commission (NPC)
Cybercrime Prevention Act of 2012 (R.A. 10175)
- Can overlap where there is online harassment, cyber libel, hacking, or data interference.

6. Criminal law (Revised Penal Code and special laws)

Abusive collectors sometimes cross into criminal acts, such as:

Grave threats or grave coercion
Libel (defamatory posts and messages sent to third parties)
Unjust vexation and related offenses
Extortion / robbery with intimidation if they demand money with threats not related to any legitimate debt
Violation of Anti-Wiretapping, in rare cases, if they record calls without consent under certain circumstances

III. What counts as “usurious” or illegal in lending app practices?

Given that statutory interest caps were lifted, “usury” in the classic sense is less used. In practice, complaints revolve around:

1. Unconscionable interest, fees, and penalties

Courts may consider the following as signs of unconscionability:

Interest rates far out of proportion to market rates (e.g., very high per day or per week that translate to several hundred percent per year).
Short terms (7–14 days) with fees that in effect consume a significant portion of the loan.
Layered charges: processing fees, service fees, handling fees, and penalties that are not properly disclosed.
Penalty interest that compounds aggressively, making repayment nearly impossible.

Even if such rates are not “illegal per se,” a court may reduce them and treat only a reasonable rate as enforceable.

2. Misrepresentation and lack of transparency

Acts that may be problematic:

Advertising “0% interest” but imposing large “service fees” that are functionally interest.
Not disclosing:
- Effective annual interest rate,
- Total repayable amount,
- Fees upon early repayment.
Using overly complex or hidden terms in the contract.

These can amount to:

Violations of the Truth in Lending Act,
Deceptive or unfair trade practices under consumer laws,
Regulatory violations under SEC/BSP rules.

3. Unfair and abusive collection practices

Common complaints include:

Calling or messaging a borrower’s contacts (family, employer, colleagues) to shame or pressure the borrower.
Sending messages accusing the borrower of being a criminal, a thief, or a scammer.
Threatening:
- Arrest without basis,
- Lawsuits they do not intend to file, or
- Posting edited pictures or private data online.

Such acts may violate:

Data Privacy Act (unauthorized disclosure, over-collection of data),
Consumer protection laws on abusive collection practices,
Criminal provisions on threats, extortion, and libel.

4. Operating without proper licenses

An app may be illegal if:

It represents itself as a lender or financing company without an SEC license and Certificate of Authority.
It is a bank-like operation without BSP authorization.

Borrowers can then file complaints with SEC/BSP and the app’s owners may face:

Administrative fines,
Cease-and-desist orders,
Criminal prosecution.

IV. Where and how to file complaints

Borrowers often need to file complaints with multiple agencies, depending on the issue.

1. Securities and Exchange Commission (SEC)

Best for:

Unlicensed lending apps
Licensed apps that violate lending company/financing company rules
Misrepresentations and unfair terms, particularly by lending/financing corporations.

You can generally complain to the SEC if:

The app identifies itself as a “lending corporation”, “financing company”, or similar; or
Company details in the app show a corporate entity under Philippine law.

Reliefs can include:

Investigation and administrative sanctions against the company,
Revocation of licenses,
Public advisories and cease-and-desist orders.

2. Bangko Sentral ng Pilipinas (BSP)

Best for:

Banks, electronic money issuers, and BSP-supervised financial institutions offering online loans.
Issues like:
- Failure to disclose interest and fees,
- Abusive collection methods,
- Overcharging.

BSP can:

Impose administrative fines,
Order remediation and consumer redress,
Direct supervision actions on regulated institutions.

3. National Privacy Commission (NPC)

Best for data privacy violations, such as:

Accessing contacts, photos, and other personal data beyond what is necessary for lending.
Sending mass messages to a borrower’s contacts disclosing the debt or defaming the borrower.
Storing, transmitting, or using data without proper consent or in violation of declared purposes.

A complaint to the NPC may result in:

Orders to cease unauthorized processing,
Penalties and enforcement actions against the data controller/processor,
Recommendations for criminal prosecution in serious cases.

4. Philippine National Police (PNP), NBI, and prosecutors

Best for criminal aspects, for example:

Harassment rising to grave threats or coercion.
Extortion (demands for money under threat unrelated to legitimate debt).
Libelous statements disseminated via SMS, messenger apps, or social media.
Cybercrime-related offenses.

Borrowers may:

File a criminal complaint with the PNP (e.g., cybercrime division) or NBI,
Or file directly with the Office of the City/Provincial Prosecutor.

5. Barangay (Katarungang Pambarangay) and civil courts

For civil disputes (e.g., you contest the debt amount, interest, or collection), you may:

Go to the barangay for conciliation/mediation if the parties are in the same city/municipality and the case is subject to barangay jurisdiction.
File a civil case or small claims case (for amounts within the small claims jurisdiction) to:
- Question the validity of the loan agreement,
- Ask the court to nullify or reduce unconscionable interest and charges,
- Seek damages for abusive practices if warranted.

V. Building a solid complaint

Regardless of where you file, effective complaints usually follow a similar structure.

1. Identify the parties and the app

Full name of the complainant (borrower).
Name of the app and its developer/company (as shown in the app, Google Play/App Store listing, or terms and conditions).
Any corporate names, addresses, registration numbers, if visible in:
- App’s “About/Legal” section,
- Screenshots of SEC registration/CA (if the app displays them),
- Email or SMS footers.

2. State the facts clearly and chronologically

Include:

Date of download and registration on the app.
Amounts borrowed, dates of each transaction, loan terms stated.
Screenshots of:
- Interest rates and fees as displayed,
- Repayment schedules,
- Any contradictory or misleading info.
Collection efforts:
- Dates and times of calls and messages,
- Content of abusive messages (screenshots, recordings),
- Instances where the app contacted relatives, employer, or coworkers.
Any threats, public shaming, or false accusations made against you.

The goal is to allow the regulator or court to visualize the pattern of abuse.

3. Legal characterization (what laws were violated)

While a layperson’s complaint can be simple, it helps to at least identify the nature of the violations:

Excessive and unconscionable interest and charges → Ground for court reduction/nullity; possible violation of consumer protection rules.
Failure to disclose true cost of credit → Possible violation of Truth in Lending Act and related regulations.
Abusive and harassing collection → Violation of financial consumer protection rules, consumer law, and possibly criminal law.
Unauthorized access/transfers/use of personal data → Violations of Data Privacy Act and implementing rules.
Operation as a lending/financing business without SEC authority → Violations of Lending Company Regulation Act / Financing Company Act and SEC rules.

You don’t need to perfectly quote the law, but labeling the issues helps the receiving agency route your complaint properly.

4. Evidence

Attach or preserve:

Screenshots:
- App pages showing terms, interest, and fees.
- Conversation threads with collectors.
- Messages sent to your contacts.
Receipts and proof of payment:
- Payment confirmations,
- Bank/e-wallet transaction screenshots,
- Statements of account, if any.
Copy of your complaint email or in-app tickets (if any) and replies from the company.
Any identification of the company (SEC registration screenshot, official website info, etc., if available).

VI. Possible outcomes and remedies

1. Administrative and regulatory remedies

From SEC/BSP/NPC:

Fines and penalties against the company.
Revocation or suspension of licenses and authorities.
Orders to change policies, stop certain data practices, or stop operations.
Public advisories to warn other consumers.

These actions primarily discipline the lender and help the wider public, but may not always result in direct compensation to a particular borrower (unless a specific restitution order is issued).

2. Civil remedies (courts and small claims)

You may ask a court to:

Declare void or reduce unconscionable interest and charges.
Order the lender to accept payment of just the principal plus reasonable interest.
Award moral and exemplary damages and attorney’s fees in proper cases.

Small claims procedures are designed to be more streamlined, without the need for a lawyer, within certain monetary limits.

3. Criminal liability

If the collectors or company officers committed criminal acts, they may face:

Imprisonment and/or fines under the Revised Penal Code and special laws.
Possible civil liability arising from crime.

Criminal complaints can be a deterrent and may pressure abusive lenders to settle or adjust their collection behavior, but the process can take time.

VII. Typical defenses and realities borrowers face

Lending apps, when confronted, may argue:

You consented to:
- The interest rate,
- The app permissions,
- The data processing.
The loan was fully disclosed, and you benefited from receiving the money quickly.
Collection efforts are “necessary” because of high default rates among borrowers.

Courts and regulators will then balance:

The principle of freedom of contract,
Against public policy, morals, and statutory protections for consumers and data subjects.

Important realities:

Filing complaints does not automatically erase your debt.
- Courts may still require you to pay the principal and a reasonable interest rate.
Ignoring a legitimate debt can still lead to lawful collection measures or civil suits, separate from illegal harassment.

The key legal distinction is:

You can contest abusive or unlawful practices while acknowledging legitimate obligations, or you can dispute both the amount and the legality of the loan terms.

VIII. Practical strategies for borrowers

1. Document everything from the start

Keep all receipts and screenshots.
Do not delete abusive messages; they are evidence.
Note dates and times of calls and harassment.

2. Separate urgent relief from long-term solutions

If you are in immediate danger (serious threats), prioritize:
- Reporting to authorities (PNP/NBI),
- Seeking support from family/community.
For longer-term relief:
- Consider regulatory complaints (SEC/BSP/NPC),
- Ask a lawyer about civil cases or small claims.

3. Don’t be pressured into worse arrangements

Some apps may:

Pressure you into rolling over loans with new fees,
Ask you to pay through unofficial channels that are hard to trace.

Try to:

Pay only through official, traceable methods,
Get written or electronic acknowledgment of any settlement.

4. Consider collective action

In practice, regulators often move faster when:

Many borrowers complain against the same app or company, or
The media or public interest is involved.

Joining or supporting group complaints may increase pressure.

IX. How lawyers typically approach these cases

A Philippine lawyer handling complaints against lending apps will usually:

Review documents and app screenshots to identify:
- Whether the lender is SEC/BSP-regulated,
- The effective interest rate and charges,
- Evidence of data privacy violations and harassment.
Decide:
- Whether to prioritize regulatory complaints,
- Or to go straight to civil or criminal actions (or both).
Draft:
- Demand letters asserting that interest and penalties are unconscionable,
- Requests to cease abusive collection and data misuse,
- Warnings of possible legal action if practices continue.
If needed, file cases and argue that:
- The interest rates should be reduced to a reasonable level,
- Harassment and data misuse should be compensated with damages,
- Regulatory sanctions should be imposed.

X. Sample outline of a complaint (for understanding, not a template)

A typical narrative structure in a complaint might look like:

Parties
- “I, [Name], Filipino, of legal age, residing at [address]…”
- “Respondent is [Company/App Name], with last known address at [address]…”
Nature of the complaint
- “This is a complaint for abusive lending and collection practices, data privacy violations, and unconscionable interest charges.”
Factual background
- Date you downloaded the app and registered.
- Amounts and dates of each loan.
- Stated terms (as per app screenshots).
- Payments already made and current balance demanded.
Abusive practices
- Specific dates and instances where:
  - Collectors used obscene, insulting, or threatening language,
  - Messages were sent to your contacts,
  - False statements were made about you.
Legal basis (in broad strokes)
- Violations of lending/financing regulations and consumer protection laws.
- Violations of Data Privacy Act (unauthorized disclosure of your loan status to third parties).
- Acts possibly constituting grave threats, libel, unjust vexation, etc.
Prayer (relief sought)
- Investigation and sanctions against the app/company.
- Orders to cease abusive collection and data processing.
- Recommendation or grant of appropriate damages or corrective measures, if within the agency’s power.

XI. Final notes and practical cautions

The law is evolving as regulators and courts continue to deal with new forms of digital lending and fintech.
There is no single magic law that makes all high-interest lending “automatically illegal,” but:
- Unconscionable interest can be judicially reduced,
- Abusive collection and privacy violations can be sanctioned,
- Unlicensed lending can be shut down and prosecuted.

If you are dealing with a problematic lending app in the Philippines, it is usually wise to:

Consult a Philippine lawyer or legal aid group who can review your specific documents.
Consider a multi-pronged approach:
- Negotiating reasonable settlement terms,
- Filing complaints with SEC/BSP/NPC,
- And, where justified, pursuing civil and/or criminal remedies.

This combination—backed by clear documentation—gives you the best chance to protect your rights while addressing legitimate financial obligations in a fair and lawful manner.