The rise of Financial Technology (FinTech) in the Philippines has facilitated easier access to credit. However, it has also birthed a surge in predatory lending practices characterized by unconscionable interest rates, hidden fees, and coercive collection tactics. For borrowers trapped in debt cycles, the Philippine legal system provides specific mechanisms for redress.

1. Legal Basis: What Constitutes "Predatory" Interest?

While the Philippines technically "suspended" the Usury Law (via BSP Circular No. 905 in 1982), interest rates are not entirely unregulated. Philippine jurisprudence remains clear:

Unconscionable Rates: The Supreme Court has consistently ruled (e.g., Medel vs. Court of Appeals) that even if the parties agreed to a high interest rate, courts can reduce it if it is "iniquitous, unconscionable, and contrary to morals." Rates exceeding 3% to 4% per month are often scrutinized and struck down by courts.
BSP Ceiling (Circular No. 1133): As of 2022, the Bangko Sentral ng Pilipinas (BSP) imposed a ceiling on interest rates and charges for small-value, short-term loans offered by lending and financing companies.
Nominal Interest Rate: Capped at 6% per month (approx. 0.2% daily).
Effective Interest Rate (EIR): Capped at 15% per month.
Penalties for Late Payment: Capped at 1% per month on the outstanding amount.

2. Regulatory Authorities

Depending on the nature of the violation, complaints should be filed with the following agencies:

Securities and Exchange Commission (SEC)

The SEC regulates Lending Companies and Financing Companies. If an OLA is registered but charging illegal rates or using abusive collection practices, the SEC’s Corporate Governance and Finance Department (CGFD) is the primary authority.

Bangko Sentral ng Pilipinas (BSP)

If the OLA is operated by a bank or a subsidiary of a bank, the BSP’s Consumer Protection and Market Conduct Office handles the grievance.

National Privacy Commission (NPC)

If the OLA accessed your contacts, posted your debt on social media, or engaged in "debt shaming," they are in violation of the Data Privacy Act of 2012.

3. Step-by-Step Filing Process

Step 1: Document Evidence

Before filing, gather all digital evidence. Courts and regulators require "substantial evidence."

Screenshots of the loan agreement and Disclosure Statement.
Transaction history showing payments and remaining balance.
Screenshots of threats, harassment, or "shaming" messages.
Proof that the interest charged exceeds the BSP-mandated caps.

Step 2: Formal Demand Letter

Though not always strictly required for an administrative complaint, sending a formal letter to the OLA’s customer service or legal department—demanding they align their rates with BSP Circular 1133—serves as proof of your attempt to resolve the matter in good faith.

Step 3: Filing the SEC Complaint

For most OLAs, use the SEC’s online portal:

Visit the SEC i-Message or the dedicated Lending/Financing Complaint Portal.
Provide the OLA’s Corporate Name (often different from the App Name). Check the SEC website for the "List of Registered Lending Companies."
Attach your Evidence and a Verification and Certification Against Forum Shopping (a notarized document stating you haven't filed the same case elsewhere).

Step 4: Filing with the NPC (For Harassment)

If the predatory interest is accompanied by data privacy violations:

File a Formal Complaint with the NPC.
Highlight the "Unauthorized Processing" of your contact list or personal information for the purpose of harassment.

4. Criminal and Civil Remedies

Beyond administrative complaints, borrowers may pursue:

Civil Action: To declare the interest rates void or to recover excess payments (Solutio Indebiti).
Criminal Action: If the OLA is unregistered, they are in violation of the Lending Company Regulation Act of 2007. If they use threats, they may be liable for Grave Coercion or Unjust Vexation under the Revised Penal Penal Code.

5. Summary of Prohibited Acts

Under SEC Memorandum Circular No. 18 (Series of 2019), the following collection practices are illegal:

Using threats of violence or other criminal means to harm the person, reputation, or property.
Using profanity or obscene language.
Disclosing the borrower's name as a "delinquent" publicly.
Contacting people in the borrower's contact list without express consent.
Making false representations that the borrower will be jailed (Philippine law prohibits imprisonment for non-payment of debt, unless fraud/estafa is involved).

Violation	Relevant Law/Regulation	Agency
Excessive Interest	BSP Circular No. 1133	SEC / BSP
Harassment	SEC MC No. 18 (2019)	SEC
Data Privacy Breach	RA 10173	NPC
Unregistered Lending	RA 9474	SEC / PNP