How to File a Complaint Against an Abusive Lending Company in the Philippines (Complete Legal Guide, updated to June 19 2025)
1. Quick-View Checklist
| What you need | Where to go | Key legal basis | Possible outcomes |
|---|---|---|---|
| Screenshots of threats, messages, contracts, receipts | SEC — Enforcement and Investor Protection Dept. (EIPD) if the lender is a lending/financing company or online lending app | ▪ RA 9474 (Lending Company Regulation Act) ▪ RA 11765 (Financial Products & Services Consumer Protection Act, “FPSCPA”) |
Cease-and-Desist Order (CDO), fine ≤ ₱1 M + ₱2 000/day, license revocation, criminal referral |
| Same evidence, plus bank statements | BSP — Financial Consumer Protection Dept. (FCPD) if the lender is a bank, thrift bank, rural/co-op bank, microfinance NGO | ▪ BSP Circular 1098 (2020 Consolidated Consumer Protection Regs.) ▪ RA 11765 |
Written order to refund, suspend officers, administrative fine |
| Proof lender misused your phone contacts or selfies | National Privacy Commission (NPC) | ▪ RA 10173 (Data Privacy Act) | Compliance order, stop-processing order, fine ≤ ₱5 M, imprisonment 1–3 yrs |
| “Shaming posts,” threats, extortion | Local Prosecutor’s Office / PNP / NBI | ▪ Revised Penal Code (grave threats, unjust vexation, libel) ▪ RA 10175 (Cybercrime) |
Criminal charges, arrest, damages |
| Unconscionable interest or hidden fees ≤ ₱1 M | Small Claims Court | ▪ A.M. 08-8-7-SC (small-claims rules, 2020-2024 updates) | Money judgment within 30 days, no lawyer needed |
(You may pursue several tracks at once; they are not mutually exclusive.)
2. What Counts as “Abusive” Collection or Lending Conduct?
Under RA 11765 (2022) and its Implementing Rules (BSP, SEC & IC Joint Regs., January 2024), abusive acts include:
- Harassment or threats (physical, reputational, or legal) toward the borrower or contacts.
- Public shaming: posting debts on social media, group chats, or work channels.
- Unfair contact frequency: calls outside 7 AM – 9 PM; more than three collection calls a day.
- Data misuse: scraping phonebooks, demanding selfies/IDs not proportional to loan size, retaining data longer than “legitimate business purpose.”
- Misrepresentation: hiding effective interest, fees, penalties; claiming endorsement by government.
- Unconscionable interest: while the Anti-Usury Law’s ceilings were lifted in 1983, courts still void rates that “shock the conscience” (often > 36 % p.a. for secured, > 48 % for unsecured).
- Operating without a SEC Certificate of Authority (CA) or without BSP license if deposit-taking.
3. Principal Laws & Regulations (Philippine Context)
| Law / Regulation | Highlights for Borrowers |
|---|---|
| RA 11765 (FPSCPA, 2022) | First omnibus consumer-protection statute covering all financial providers; creates the Financial Consumer Protection Assistance Mechanism (FCPAM) in each regulator; gives SEC/BSP power to adjudicate claims ≤ ₱10 M and order restitution. |
| RA 9474 (Lending Company Regulation Act, 2007) | Requires every lending/financing company to secure a SEC CA; directors liable for violations. |
| SEC MC 18-2019 & MC 10-2021 | Special rules for online lending apps (OLAs): mandatory disclosure of data-access permissions; prohibition on harvesting phone contacts; interest cap of 35 %/month (effective Jan 2023). |
| RA 3765 (Truth in Lending Act) | Lender must disclose effective interest rate (EIR) and all charges in writing. |
| BSP Circular 1098 (2020) | Consolidated consumer-protection rules for BSP-supervised institutions (BSIs). |
| RA 10173 (Data Privacy Act, 2012) | Protects personal data; “borrower’s contacts” are personal information; misuse triggers fines and jail. |
| RA 7394 (Consumers Act, 1992) | Deceptive sales practices, unconscionable contracts. |
| Revised Penal Code + RA 10175 | Grave threats, unjust vexation, cyber-libel, extortion, lending without license (Art. 315 swindling). |
4. Step-by-Step Complaint Procedures
A. SEC Route (for lending/financing companies & OLAs)
Verify Registration
- Search the SEC “Verify Your Lender” portal or text +63 948 123 0909.
Gather Evidence
- Contracts, e-mails, Viber/FB/cloned SMS, call recordings, screenshots, payment slips.
Fill Out the SEC Financial Consumer Complaint Form
- Downloadable PDF; indicate violations (harassment, hidden charges, non-registration, etc.).
Submit
- E-mail: complaints@sec.gov.ph or eipd@sec.gov.ph (PDF ≤ 20 MB).
- Walk-in: SEC Main, PICC Bldg., Pasay City, or any Extension Office.
Mediation / Summons (within 15 calendar days)
- SEC may call both parties; no lawyer required but allowed.
Resolution
- CDO / suspension issued within 30 days if prima facie harassment.
- Adjudication: restitution + fines; SEC can order deletion of borrower’s data under MC 10-2021.
Appeal
- Petition for Review to the Court of Appeals under Rule 43 within 15 days.
B. BSP Route (banks, quasi-banks, payment firms)
- Contact the bank first via its Consumer Assistance Unit (CAU) and obtain a Case Reference Number (CRN).
- If unresolved after 15 banking days, lodge a written complaint to consumeraffairs@bsp.gov.ph or through the BSP Online Buddy (BOB) chatbot.
- Attach CRN, IDs, and supporting evidence.
- BSP adjudicators may conduct video hearings; final order served within 45 days.
C. National Privacy Commission
- File within 6 months from discovery of the data privacy violation.
- Use the NPC e-RegCom portal; attach a sworn complaint (PDF) + proof of identity.
- NPC holds complaint-assessment hearing; mediation required before formal investigation.
D. Small Claims (Civil)
- Check that the principal claim (excluding interests/penalties) ≤ ₱1 000 000 (Rule SC-2024).
- Draft SC-Form 1-SCC (Statement of Claim) citing Art. 11765 unconscionability; filing fee ≈ ₱2 k.
- No lawyer allowed; courts must decide within 30 calendar days from first hearing.
E. Criminal Remedies
- Barangay conciliation is not required for threats/harassment committed by corporations (Luansoy v. Villanueva, G.R. 243177, July 5 2022).
- Execute a Sinumpaang Salaysay at the nearest police station or NBI Cybercrime Division.
- Prosecutor’s resolution issued within 60 days; court trial thereafter.
5. Evidence Tips & Best Practices
- Always retain raw files (not cropped screenshots) with embedded timestamps.
- Use a call-recording app that preserves metadata; Android 10+ requires accessibility service consent.
- Send a Formal Demand Letter first; many courts look for good-faith effort before litigation.
- Keep a payment ledger; print GCash/GrabPay wallet histories (BSP MC M-2023-003 recognizes e-receipts).
6. Possible Penalties for Lenders
| Violation | Fine / Sanction | Imprisonment |
|---|---|---|
| Operating without SEC CA (RA 9474 §12) | ≤ ₱10 000/day + revocation | 6 mos – 10 yrs |
| Data Privacy misuse (RA 10173 § 32) | ≤ ₱5 M | 1 – 3 yrs |
| Harassment under FPSCPA (RA 11765 § 14) | ≤ ₱2 M plus restitution | N/A (administrative) |
| Cyber-libel (RA 10175) | fine + damages | prisión correccional max – prisión mayor min (6 yrs 1 day – 8 yrs) |
7. After Filing: What to Expect
- Acknowledgment e-mail within 3 days (SEC/BSP).
- Preliminary conference by phone or Zoom; opportunity to settle.
- Regulatory order enforceable immediately; lender may move for reconsideration only once.
- Collection stops once a CDO is served—continue recording any new contact for contempt.
- Credit-bureau records: Successful adjudication obliges lender to amend negative reports with CIC within 5 days (CIC Circular 6-2024).
8. Preventive Measures When Borrowing
- Check the SEC “List of Registered OLAs” before installing; Google Play & Apple App Store now require the package name to match the SEC list (as of April 2024).
- Read the Privacy Consent Screen: OLAs may request camera (for ID capture) and location (anti-fraud). Deny contacts and SMS access—apps must remain functional without them.
- For micro-loans, compare with government programs (e.g., SB Corp. Resilient MSME Loan up to ₱1 M at 6 % p.a.).
9. FAQs
Q: Will filing a complaint stop interest from accruing? – Regulatory cease-orders usually freeze additional interest and penalties prospectively but not retroactively; negotiate or plea unconscionability in small-claims court for a full write-down.
Q: Can I refuse to pay at all if the lender is unlicensed? – Courts have ruled that void loans (no SEC CA) cannot be enforced through collection suits, but borrowers must return the principal under unjust enrichment (Baligod v. Modern MRC Lending, CA-G.R. CV 119342, July 2021).
Q: I live abroad but borrowed online in the Philippines; where do I complain? – Still file with SEC/BSP; jurisdiction rests on the lender’s place of business. Attend hearings via video.
10. Template: SEC Complaint Letter
Subject: Complaint vs. [Lender Name] for Harassment & Unlawful Collection
Parties: I am Juan Dela Cruz, borrower; respondent is XYZ Lending Corp. (SEC Reg. No. CS2019-12345, CA No. 3050).
Facts: On 12 May 2025 I obtained a ₱3 000 salary loan via XYZ’s app. Beginning 19 May 2025, collectors called me nine times daily, threatened “posting to HR and Facebook,” and messaged my mother (screenshot Annex “A”).
Violations Alleged:
- SEC MC 18-2019 § 4(b)(iv) — unauthorized access to phone contacts.
- RA 11765 § 14 — harassment in collection.
- RA 3765 — failure to disclose EIR; only “processing fee” quoted.
Relief Prayed For: Immediate Cease-and-Desist Order; deletion of my personal data; refund of ₱900 “service fee”; administrative fines.
Attachments: Contract (Annex “B”), payment receipts (Annex “C”), call logs (Annex “D”).
Respectfully submitted, /s/ Juan Dela Cruz 19 June 2025, Quezon City
11. Final Notes & Professional Advice
- You may engage a lawyer, but regulators designed these processes to be borrower-friendly and pro se.
- If your debt causes serious anxiety or thoughts of self-harm, call the National Center for Mental Health Crisis Hotline 1553 (toll-free).
- Laws evolve quickly—especially RA 11765 rules. Check each regulator’s website for the most recent circulars before filing.
Disclaimer: This article provides general legal information current as of June 19 2025; it is not legal advice. For case-specific counsel, consult a Philippine lawyer.