Filing Complaints Against Lending Companies for Unfair Practices in the Philippines

This article explains, end-to-end, how Filipino borrowers can identify unfair lending practices, choose the right forum, prepare and file a complaint, and pursue remedies—whether the lender is a bank, financing or lending company, online lending platform (OLP), debt collector, or a shadow/illegal lender. It reflects Philippine law and regulatory practice as generally applied.

I. Quick primer: who regulates whom?

Understanding jurisdiction is the first and most important step.

Banks, e-money issuers, remittance agents, and other BSP-supervised financial institutions (BSFIs) Regulator: Bangko Sentral ng Pilipinas (BSP) under the Financial Products and Services Consumer Protection Act (FCPA, R.A. 11765) and BSP consumer protection framework. Examples: universal/thrift/rural banks; credit card issuers; EMI wallets.
Financing and lending companies (non-banks) Regulator: Securities and Exchange Commission (SEC) under the Financing Company Act (R.A. 8556) and Lending Company Regulation Act (R.A. 9474), plus SEC rules on unfair debt collection and online lending conduct.
Cooperatives that grant loans to members Regulator: Cooperative Development Authority (CDA) (internal member complaints may also be governed by the coop’s bylaws and CDA rules).
Insurance premium finance and collection tied to insurance Regulator: Insurance Commission (IC) (if the dispute relates to an insurance product).
Data privacy violations (e.g., doxxing, scraping your contacts, abusive disclosure) Regulator: National Privacy Commission (NPC) under the Data Privacy Act (R.A. 10173).
Criminal harassment, threats, extortion, cyber offenses PNP/NBI for criminal complaints; courts for criminal prosecution.

Tip: a single case can touch multiple fora (e.g., abusive collection by a registered lending app = SEC and NPC; criminal threats = PNP/NBI; damages = civil action in court).

II. What counts as “unfair” lending or collection practice?

While details vary by regulator, the following are widely recognized as prohibited or abusive:

Harassment and abusive collection
- Threats of harm, profane or humiliating language, slurs.
- Public shaming: posting your name/photo online or group chats, mass texting your contacts, “shout-outs” on social media.
- Excessive or untimely calls (e.g., calling deep into the night), contacting workplace or relatives to shame or coerce payment.
Doxxing / unlawful processing of personal data
- Accessing your phone contact list or gallery without lawful basis; disclosing debt to third parties; using your photo without consent.
Misrepresentation and deceptive advertising
- “0% interest” claims with undisclosed fees; bait-and-switch loan amounts or tenors; unauthorized auto-debits.
Unconscionable charges and penalties
- Punitive “processing fees,” cascading penalties, or interest/fees that are iniquitous and unconscionable—subject to reduction by courts under the Civil Code (e.g., Arts. 1229, 2227).
- Hidden charges contrary to the Truth in Lending Act (R.A. 3765) requiring clear disclosure of finance charges.
Operating without registration or license
- Lending/financing without SEC registration; using unapproved business names; operating an online lending platform without required SEC notifications/permits.

III. Evidence you should gather (before you complain)

Written agreements: loan contract, terms & conditions, disclosures, promissory notes, schedules of fees/penalties.
Proof of payments: receipts, screenshots of transfers, bank statements, statements of account.
Collection abuse: call logs, audio recordings (if legally obtained), screenshots of texts/聊天 apps/emails, social media posts, voicemail, group chat captures, messages to your contacts.
Privacy breach: app permissions granted, screenshots of consent screens, device logs showing contact scraping, notices sent to your friends/relatives, and any platform reports.
Identity & timeline: your government ID, a dated chronology of events, and the lender’s full legal name, business address, and registration details (if available).

Organize files into labeled folders. Keep originals; submit clear copies.

IV. Choosing the proper forum (with strategy)

Situation	Primary Forum	Why it helps	Possible Outcomes
Abusive collection or deceptive practices by a lending/financing company	SEC – Enforcement/Investor Protection	Jurisdiction over L/FCs and OLPs	Administrative fines, suspension/revocation, cease-and-desist, takedowns
Abuse by a bank or EMI	BSP – Consumer Assistance (then FCPA escalation)	FCPA mandates internal dispute resolution and regulator recourse	Corrective action orders, penalties, restitution directives
Privacy violations (contact scraping, doxxing)	NPC	Data Privacy Act enforcement	Compliance orders, penalties, possible criminal referral
Unregistered/illegal lender	SEC + PNP/NBI	SEC for corporate violations; law enforcement for criminal acts (e.g., estafa, threats)	Raids/takedowns, criminal cases
Damages/refunds beyond administrative penalties	Civil action (regular or Small Claims)	Recover sums, reduce unconscionable penalties, injunctions	Money judgments, contract reformation
Ongoing criminal threats/extortion	PNP/NBI (and barangay if applicable)	Immediate protection and prosecution	Criminal charges, protective measures

Small Claims: As of recent Supreme Court amendments, the small-claims threshold is high enough to cover most consumer loan disputes, allowing quick, lawyer-optional recovery of money or reduction of iniquitous penalties. Check the latest cap at filing time with the clerk of court.

V. Standard complaint pathways and how to file

A. SEC (for lending/financing companies and online lending apps)

Write a sworn complaint stating: parties, facts in chronological order, specific unfair acts (e.g., harassment, non-disclosure, illegal charges), and prayer (what you want).
Attach evidence: contracts, screenshots, call logs, proof of payment, and your Affidavit (notarized). If there’s doxxing, include links and captures.
Relief to request: investigation, cease-and-desist against abusive collection, administrative sanctions, order to correct disclosures, and referral to NPC/BSP/DOJ as needed.
Where/how: SEC accepts complaints via its public assistance/e-complaint channels or the Enforcement/Investor Protection mailbox; physical filing is also possible at SEC offices. Include your IDs and contact details.

What to expect: SEC can penalize, suspend, revoke certificates, order app store takedowns of abusive OLPs, and issue cease-and-desist orders. Note: SEC’s focus is administrative/regulatory. If you seek damages, you usually need a court case.

B. BSP (for banks, card issuers, EMIs)

Exhaust internal remedies first: File with the bank’s Consumer Assistance Mechanism (CAM) and keep the ticket numbers and written responses.
Elevate to BSP if unresolved or if there’s imminent consumer harm. Submit your narrative, attachments, and the bank’s reply (if any).
Cite FCPA protections: fairness, transparency, suitability, privacy, and redress obligations.

What to expect: BSP may require the BSFI to rectify errors, reverse unauthorized charges, adjust fees, or improve processes; it may also impose administrative sanctions.

C. NPC (for data privacy breaches)

Document the breach: what data was collected, how it was processed, to whom it was disclosed, and resulting harm.
File a complaint/incident report with screenshots showing unauthorized access or disclosure (e.g., mass texts to your contacts).
Identify the personal information controller (PIC) (e.g., the lending company) and any processors (third-party collection agencies).

What to expect: NPC can order cease processing, erasure, breach notifications, and impose penalties; it can also refer for prosecution in egregious cases.

D. Criminal complaints (PNP/NBI/DOJ)

For threats, extortion, unjust vexation, grave coercion, libel/cyberlibel, identity theft, illegal access, or stalking, prepare a complaint-affidavit with annexes.
Law enforcement can apply for warrants (e.g., for cyber evidence) and coordinate with platforms for preservation of data.

E. Civil actions (including Small Claims)

Use civil courts to recover money, reduce unconscionable penalties, or enjoin abusive acts.
Small Claims procedure is streamlined and lawyer-optional: file a verified Statement of Claim with your exhibits; hearings are summary and fast-tracked.

VI. Substantive law borrowers often invoke

R.A. 9474 (Lending Company Regulation Act) and R.A. 8556 (Financing Company Act): registration, conduct standards, and penalties.
Truth in Lending Act (R.A. 3765): requires clear disclosure of finance charges; hidden fees or misleading quotes can be actionable.
Civil Code:
- Art. 19/20/21 (Human Relations) for damages due to bad-faith or oppressive acts;
- Art. 1229, 2227 to reduce iniquitous or unconscionable penalties/interest;
- Art. 1306 (freedom to contract) limited by law, morals, and public policy.
Data Privacy Act (R.A. 10173): limits collection/processing to lawful, proportional purposes; bans unauthorized disclosure; provides data subject rights and remedies.
Cybercrime Prevention Act (R.A. 10175): covers cyber offenses (e.g., illegal access, cyberlibel).
FCPA (R.A. 11765): codifies financial consumer protection principles for BSP-supervised entities.

Usury: Statutory interest caps were loosened decades ago, but regulators can set product-specific caps and courts may strike down unconscionable rates/penalties. Always challenge terms that are punitive or non-transparent.

VII. Step-by-step: drafting a strong complaint

Caption and parties – Identify the regulator/court; your full name, address, and IDs; the lender’s registered corporate name (not just the app or brand name).
Jurisdiction & venue – Briefly state why this office has jurisdiction (e.g., SEC over lending companies; NPC over data privacy).
Material facts – A dated timeline: application, disbursement, billing, collection incidents, communications, and harm suffered.
Violations alleged – Tie facts to rules: unfair collection, non-disclosure, privacy breach, deceptive ads, unconscionable penalties, illegal operations.
Prayer for relief – Specific, actionable asks: cease-and-desist; administrative sanctions; order to correct disclosures; deletion of unlawfully collected data; refund of illegal fees; coordination with app stores; referral to law enforcement; or, in court, damages, interest reduction, and injunction.
Verification & affidavit – Sign a Verification and Certification of Non-Forum Shopping (for courts) and notarize your affidavit and annexes where required.
Annexes – Label as Annex “A,” “B,” etc., with a simple index.

VIII. Defending yourself while you complain (practical safeguards)

Keep paying what is undisputed (if able) to reduce exposure; you can dispute illegal fees separately.
Demand a Statement of Account and official receipts; refuse to transact through personal accounts of collectors.
Communicate in writing; avoid calls where abuse occurs—request email or in-app messaging for audit trail.
Revoke excessive app permissions; take a fresh set of screenshots before uninstalling.
Notify your contacts (briefly) if they may receive harassment; encourage them to screenshot and avoid engagement.
Report in-app and to platforms (app stores/social media) when content violates platform policies.

IX. Special issues with online lending platforms (OLPs)

Name mismatch is common: the app/brand may differ from the SEC-registered corporate name. Identify both.
Third-party collectors must follow the same fair-collection standards; lenders remain responsible for agents.
Contact scraping and gallery access are high-risk: absent a lawful basis and proportionality, these are fertile grounds for NPC complaints and SEC sanctions.
Takedowns: Administrative cases can lead to removal from app stores and public advisories about errant apps.

X. Timelines and expectations

Administrative (SEC/BSP/NPC): acknowledgment in days to weeks; investigation varies by complexity and caseload.
Criminal: fact-finding and inquest times differ; complex cyber evidence can lengthen cases.
Civil/Small Claims: clerk screens the case; hearings are summary but calendars can vary by court.

Always track reference/ticket numbers and keep copies of every filing and reply.

XI. Sample complaint-affidavit (template)

[Your Name], Complainant – versus – [Full Corporate Name of Lender/Collector], Respondent

AFFIDAVIT-COMPLAINT

I am a Filipino citizen of legal age, residing at [address].

Respondent is a [lending/financing company/bank] operating under the business name “[Brand/App],” with address at [if known].

On [date], I obtained a loan of ₱[amount] under the attached Loan Agreement (Annex “A”). The disclosed charges were [list].

Beginning [date], Respondent and/or its agents engaged in unfair collection practices, including [specific acts], evidenced by Annexes “B” to “F.”

Respondent also processed and disclosed my personal data without lawful basis, including [facts], in violation of the Data Privacy Act, as shown in Annexes “G” to “H.”

The penalties and fees imposed are iniquitous and unconscionable and were not clearly disclosed, contrary to the Truth in Lending Act and the Civil Code.

I suffered [emotional distress, reputational harm, financial loss], and seek appropriate relief.

PRAYER Wherefore, I respectfully pray that this Office: (a) order Respondent to cease and desist from unfair collection and unlawful data processing; (b) impose administrative sanctions; (c) direct deletion of unlawfully collected data and correct disclosures; (d) refer the matter to appropriate authorities for criminal action; and (e) grant such other relief as may be just.

[Verification/Certification of Non-Forum Shopping, if for court] [Signature over Printed Name] [Jurat/Notarial Acknowledgment]

XII. Frequently asked questions

1) Can I force the lender to stop calling my employer/family? Yes—harassing third-party contact is typically prohibited. Seek a cease-and-desist from the regulator and, if needed, a court injunction.

2) Can a lender charge any interest it wants? Usury ceilings were largely lifted decades ago, but unconscionable rates/penalties can be reduced by courts and sanctioned by regulators, especially if undisclosed or deceptive.

3) I repaid the principal but they keep adding penalties. What now? File with the proper regulator and consider Small Claims to judicially reduce penalties and stop abusive accruals.

4) The lender isn’t registered. That strengthens your case. Report to SEC and law enforcement; do not share more data; preserve evidence.

5) Can I settle while my complaint is pending? Yes. Put settlements in writing, specify a full and final settlement of the obligation, and require deletion of unlawfully collected data and cessation of collection.

XIII. Checklist before you hit “submit”

Correct regulator chosen (SEC/BSP/NPC/CDA/IC/PNP/NBI/court)
Clear timeline and harms described
Contracts, disclosures, and proof of payment attached
Screenshots/call logs of abusive conduct attached
Proper prayer and legal bases cited
Affidavit notarized (and Verification/Non-Forum Shopping for court)
Copies saved; reference/ticket number recorded

XIV. Bottom line

You have multiple, complementary avenues: administrative (to stop abusive behavior and penalize offenders), civil (to recover money and reduce unconscionable charges), criminal (to address threats and cyber offenses), and privacy (to halt unlawful data processing and doxxing). The strongest complaints are well-documented, specific, and correctly routed. When in doubt about jurisdiction, file in parallel with the appropriate agencies and clearly identify the overlapping violations.

This article is for general information only and not a substitute for tailored legal advice. For complex or high-stakes cases, consult a Philippine lawyer who can assess facts, strategy, and timing in detail.