Harassment and Threats by Online Lending Apps in the Philippines

I. Introduction

The rapid proliferation of online lending applications in the Philippines since 2017 has provided convenient access to credit for millions of unbanked and underbanked Filipinos. However, this growth has been accompanied by widespread predatory practices, particularly aggressive and illegal debt collection methods employed by many unregulated platforms. Borrowers who fall into arrears frequently face systematic harassment, public shaming, threats of violence, dissemination of altered pornographic images, and unauthorized disclosure of personal data to their entire contact list. These practices constitute serious violations of criminal, civil, and administrative laws, yet remain pervasive due to the anonymity afforded by digital platforms and the slow pace of enforcement.

This article comprehensively examines the phenomenon from a Philippine legal perspective, detailing the common abusive tactics, the applicable legal framework, available remedies, landmark cases and regulatory actions, and recent legislative developments as of December 2025.

II. Common Forms of Harassment and Threats

Unregistered online lending apps typically employ the following illegal collection tactics:

1. Mass messaging to all contacts retrieved from the borrower’s phone during loan application (without valid consent), labeling the borrower as “scammer,” “criminal,” “deadbeat,” or “prostitute.”
2. Creation and distribution of fake obscene photos (e.g., superimposing the borrower’s face on pornographic images).
3. Threats of physical violence, rape, or death to the borrower or family members.
4. Public shaming through posts on Facebook groups dedicated to exposing “scammers.”
5. Threats of fake lawsuits, arrest warrants, or barangay summons.
6. Continuous calls and messages at all hours, including to employers, causing job loss or extreme emotional distress.
7. Disclosure of sensitive personal information (health conditions, family details, workplace) without consent.

These methods are designed to inflict maximum humiliation and fear, often driving victims to suicide. The National Privacy Commission and the Philippine National Police documented at least 12 suicides directly linked to online lending harassment between 2019 and 2023.

III. Legal Framework Governing Online Lending and Debt Collection

A. Registration and Licensing Requirements

1. Securities and Exchange Commission (SEC)

   • Under Republic Act No. 9474 (Lending Company Regulation Act of 2007) and its IRR, all entities engaged in lending must register as lending companies or financing companies with the SEC.
   • SEC Memorandum Circular No. 19, series of 2019 expressly requires online lending platforms to register and prohibits third-party collection by unregistered entities.
   • Operating without SEC registration is a criminal offense punishable by fine (₱50,000–₱2,000,000) and imprisonment (6 months–10 years) under Section 29 of RA 9474 in relation to Section 44 of the General Provisions of RA 8799 (Securities Regulation Code).

2. Bangko Sentral ng Pilipinas (BSP)

   • BSP-registered banks and their accredited collection agencies must comply with Circular No. 1133 (2021) on fair debt collection practices.

B. Prohibited Acts Under Consumer Protection Laws

1. Republic Act No. 11765 (Financial Products and Services Consumer Protection Act of 2022)

   • Section 6 expressly prohibits the following unfair collection practices:
     • Use of threats of violence or intimidation
     • Public shaming or humiliation
     • Disclosure of debt to third parties without consent
     • Use of obscene or profane language
     • Contacting borrowers at unreasonable hours (before 6 a.m. or after 10 p.m.)
   • Violations are punishable by administrative fines of ₱50,000–₱1,000,000 per violation and criminal penalties of imprisonment from 6 months to 7 years.

2. Republic Act No. 3765 (Truth in Lending Act) and RA 7394 (Consumer Act of the Philippines)

   • Require full disclosure of finance charges and prohibit deceptive practices.

C. Criminal Liabilities

1. Revised Penal Code

   • Article 282 – Grave threats (prision correccional, 6 months–6 years)
   • Article 283 – Light threats (arresto mayor, 1–6 months)
   • Article 287 – Unjust vexation (arresto menor or fine)
   • Article 353–355 – Libel (prision correccional in its minimum and medium periods)

2. Republic Act No. 10175 (Cybercrime Prevention Act of 2012)

   • Section 4(a)(1) – Cyber libel (penalty one degree higher than ordinary libel: prision mayor, 6–12 years)
   • Section 4(c)(4) – Online libel through mass dissemination
   • Section 4(b)(3) – Computer-related identity theft (used when collectors create fake obscene images)

3. Republic Act No. 10173 (Data Privacy Act of 2012)

   • Section 25 – Unauthorized processing of personal information (imprisonment 1–3 years, fine ₱500,000–₱2,000,000)
   • Section 26 – Unauthorized processing of sensitive personal information (imprisonment 3–6 years, fine ₱500,000–₱4,000,000)
   • Section 27 – Malicious disclosure
   • NPC Circular No. 2022-01 (2022) specifically declares the broadcasting of borrower information to contacts as a grave violation of the Data Privacy Act.

4. Republic Act No. 10175 in relation to RA 9262 (Anti-Violence Against Women and Their Children Act)

   • When harassment targets women and causes psychological violence, it constitutes economic abuse under Section 5(e) and psychological violence under Section 5(i).

IV. Remedies Available to Victims

1. Criminal Complaints (file at Prosecutor’s Office or directly in court for certain offenses)

   • Cyber libel, grave threats, unjust vexation, violation of Data Privacy Act
   • No need for private lawyer; public prosecutor handles the case after preliminary investigation

2. Civil Action for Damages

   • Under Articles 19, 20, 21, 26, 32, 33, 34 of the Civil Code (abuse of rights, violation of privacy, human dignity)
   • Moral damages (₱100,000–₱1,000,000 in practice), exemplary damages, attorney’s fees

3. Administrative Complaints

   • SEC – for unregistered lending (leads to permanent cease-and-desist orders)
   • National Privacy Commission – for data privacy violations (fines up to ₱5,000,000 and criminal referral)
   • Bangko Sentral ng Pilipinas – against accredited operators

4. Protection Orders

   • Barangay Protection Order (BPO)
   • Temporary/Permanent Protection Order under RA 9262 (if victim is female)

5. Practical Steps for Immediate Relief

   • Report the app to Google Play Store/Apple App Store for policy violation (many apps are removed within days)
   • File report via NPC’s online portal (privacy.gov.ph)
   • Submit complaint to SEC via online portal (sec.gov.ph/online-lending-complaints)

V. Landmark Cases and Regulatory Actions (2019–2025)

• SEC v. Cashalo, UnaCash, JuanHand, etc. – Permanent cease-and-desist orders issued against over 300 unregistered platforms (2020–2024)
• People v. Collectors of “Pesoloan” (Quezon City RTC, 2021) – First conviction for cyber libel and unjust vexation involving online lending harassment; accused sentenced to 8 years imprisonment
• NPC v. Various Lending Apps (2022–2023) – Imposed ₱4–₱5 million fines on apps such as MoneyTree, QuickPeso, and CashJeep for mass broadcasting of borrower data
• PNP Anti-Cybercrime Group Operations (2023–2025) – Arrest of several Chinese nationals operating harassment call centers in Pampanga and Metro Manila
• House Bill No. 8981 / Senate Bill No. 2483 (18th Congress) – Proposed “Online Lending Harassment Act of 2022” (did not pass but provisions were incorporated into RA 11765 and its IRR)

VI. Current Status as of December 2025

Despite aggressive enforcement, new apps continue to emerge under different names. The SEC maintains a regularly updated list of registered lending companies (fewer than 200 as of November 2025) and warns the public against all others. The PNP-ACG reports a 40% decrease in complaints since 2023 due to sustained operations and app removals, but harassment remains a daily reality for thousands.

RA 11765’s IRR (issued March 2024) now mandates that all financial institutions, including digital lenders, establish internal grievance mechanisms and prohibits the sale or transfer of delinquent loans to unregistered collectors.

VII. Conclusion

Harassment by online lending apps constitutes multiple serious crimes under Philippine law — cyber libel, grave threats, unjust vexation, violations of privacy, and unfair debt collection practices. Victims are not helpless. Criminal prosecution is viable and increasingly successful, administrative sanctions are severe, and civil damages are routinely awarded. The combined force of RA 11765, the Data Privacy Act, the Cybercrime Prevention Act, and sustained enforcement by the SEC, NPC, and PNP has significantly curtailed the worst abuses.

Borrowers facing harassment should immediately document all messages, file complaints with the NPC and SEC online, and lodge criminal complaints at the nearest prosecutor’s office. No one deserves to be terrorized for a ₱3,000 loan. The law is unequivocally on the side of the victim.