The Philippines has witnessed an explosion of lending companies, particularly online lending platforms and mobile applications, over the past decade. While these entities provide quick access to credit for unbanked and underbanked Filipinos, many have resorted to predatory, abusive, and outright criminal debt collection practices. Tactics such as incessant calls and texts at unreasonable hours, public shaming through social media, disclosure of borrowers’ personal information to contacts, use of obscene language, and most egregiously, death threats and threats of physical violence, have become disturbingly common.

These practices are not merely unethical—they are illegal under multiple Philippine laws. Lending companies, whether registered or unregistered, licensed or operating illegally, are strictly prohibited from employing harassment, intimidation, or threats in debt collection. Violations carry severe administrative, civil, and criminal penalties.

Primary Law Governing Abusive Debt Collection: Republic Act No. 11765 (Financial Products and Services Consumer Protection Act of 2022)

Enacted on 06 May 2022 and effective from 03 June 2022, RA 11765 is the single most comprehensive and directly applicable law against abusive debt collection practices in the Philippines.

Section 11 of RA 11765 explicitly lists the prohibited acts in the collection of debts arising from financial products and services:

(a) Use or threat of use of violence or other criminal means to harm the consumer, his/her family, or his/her reputation;
(b) Use of obscenities, insults, or profane language which amount to a criminal offense or breach of the peace;
(c) Disclosure of the names of consumers who allegedly refuse to pay debts, except as expressly allowed under Republic Act No. 9510 (Credit Information System Act) and its IRR;
(d) Threat to take any action that cannot legally be taken;
(e) Communicating or threatening to communicate to any person credit information which is known to be false, including failure to communicate that a debt is being disputed;
(f) Use of threats to take any illegal action;
(g) Use of any false representation or deceptive means to collect any debt or to obtain information concerning a consumer.

Death threats, threats of rape, threats to post morphed nude photos, threats to visit the borrower’s home or workplace with violence, and similar tactics fall squarely under paragraphs (a) and (f). These are not only administrative violations under RA 11765 but constitute separate criminal offenses under the Revised Penal Code.

Penalties under RA 11765:

Administrative fines of ₱50,000 to ₱2,000,000 per violation
Suspension or revocation of license/registration
Cease and desist orders
Criminal liability where applicable

Criminal Liabilities Under the Revised Penal Code

Even without RA 11765, harassment and threats by collectors have always been criminal:

Grave Threats (Article 282, RPC)
Punishable by prisión correccional (6 months and 1 day to 6 years) if the threat is to kill or inflict serious injury, and the offender attains his purpose or the threat is made with a weapon or in writing.
Light Threats (Article 283, RPC)
Punishable by arresto mayor (1 month and 1 day to 6 months) for threats that do not amount to grave threats.
Other Light Coercion / Unjust Vexation (Article 287, RPC)
Excessive calls, texts, public shaming, or repeated harassment that vexes or annoys the victim without justifiable cause.
Grave Oral Defamation / Slander by Deed
Publicly shaming borrowers by posting their photos with captions like “scammer,” “deadbeat,” or morphed images.
Violation of RA 10175 (Cybercrime Prevention Act of 2012)
When harassment is done online (e.g., mass tagging on Facebook, posting in “scammer” groups, sending threats via Messenger or SMS), it becomes cyberlibel or online harassment, carrying heavier penalties (one degree higher than traditional offenses).

Data Privacy Violations: Republic Act No. 10173 (Data Privacy Act of 2012)

Most abusive lending apps collect emergency contact lists and then bombard relatives, employers, and friends with messages revealing the borrower’s indebtedness and often adding false accusations (“your friend is a thief,” “your daughter is a prostitute who refuses to pay”).

This constitutes unlawful processing of personal and sensitive personal information under RA 10173. Lending companies are personal information controllers (PICs) and must comply with the Data Privacy Act. Unauthorized disclosure to third parties without consent is a criminal offense punishable by imprisonment of up to 7 years and fines up to ₱4,000,000 (Section 25–32, RA 10173, as amended by RA 11393).

The National Privacy Commission (NPC) has issued multiple cease-and-desist orders against lending apps and has coordinated with the NBI for criminal prosecution.

Regulatory Framework and SEC/BSP Rules

The Securities and Exchange Commission (SEC) regulates financing and lending companies under RA 8556 (Financing Company Act) and RA 9474 (Lending Company Regulation Act).

SEC Memorandum Circular No. 18, series of 2019, provides the Code of Ethics and Collection Practices for lending and financing companies, explicitly prohibiting:

Humiliating, embarrassing, or abusive collection practices
Contacting third parties except for location information (and even then, without revealing the debt)
Use of threats or violence
Calls outside 8:00 AM to 8:00 PM

Unregistered online lending apps (the vast majority involved in harassment cases) are operating illegally from the outset. Operating without SEC registration is a criminal offense under Section 28 of RA 9474 (imprisonment of 1–5 years and fine of ₱50,000–₱1,000,000).

Bangko Sentral ng Pilipinas (BSP) Circular No. 1133 (2021) and Circular No. 1166 (2023) impose similar fair debt collection rules on banks and their third-party collectors.

Remedies Available to Victims

Victims of harassment and death threats by lending companies have multiple avenues for redress:

File a criminal complaint directly with the city/provincial prosecutor or police for grave/light threats, unjust vexation, cyberlibel, or violation of RA 10175 and RA 10173.
File an administrative complaint with the SEC against registered lending/financing companies (online complaint portal available).
File a complaint with the National Privacy Commission (NPC) for data privacy violations (npc.gov.ph).
File a complaint under RA 11765 with the BSP (for banks and their agents), SEC, or DTI.
File a civil case for damages (moral, exemplary, actual) under Articles 19–21, 26, 32, and 2219 of the Civil Code.
Report to the NBI Cybercrime Division or Anti-Cybercrime Group (ACG) of the PNP, especially when threats are made online or via mobile apps.

The Supreme Court has repeatedly upheld awards of moral and exemplary damages in harassment cases against collectors (e.g., Experian Credit Bureau v. Villanueva, G.R. No. 210408, 2020; various RTC decisions awarding ₱100,000–₱500,000 in damages).

Special Protection for Vulnerable Borrowers

RA 11765 and its IRR (BSP Circular No. 1166, SEC Memorandum Circulars) explicitly require collectors to treat borrowers with dignity and respect. The law recognizes the power imbalance between financial institutions and consumers, particularly low-income borrowers who are the primary targets of predatory apps.

The “5-6” Bombay-style lenders and other informal lenders are also covered if they offer consumer financial products, though enforcement is more difficult.

Current Enforcement Landscape (as of December 2025)

Since 2022, the SEC has revoked the certificates of authority of over 5,000 online lending platforms. The NBI, PNP-ACG, and NPC regularly conduct entrapment operations and raids against abusive collectors. Multiple criminal convictions have been obtained for grave threats and violation of the Data Privacy Act against collectors and app owners.

The Supreme Court’s 2023 ruling in People v. XXX (name redacted) affirmed that death threats sent via SMS by a collector constitute grave threats under Article 282 even if conditional (“Pay or we will kill you”).

Conclusion

Harassment and death threats by lending companies are unequivocally illegal under Philippine law. No debt, no matter how valid, justifies the use of intimidation, violence, or humiliation in collection. Lending companies and their agents who engage in such practices face license revocation, massive fines, imprisonment, and civil liability.

Borrowers are not defenseless. The combined force of RA 11765, the Revised Penal Code, the Cybercrime Prevention Act, and the Data Privacy Act provides powerful protection. Victims are strongly encouraged to document all threats (screenshots, recordings, call logs) and immediately file complaints with the appropriate agencies.

No one in the Philippines may be terrorized into paying a debt. The law is clear: harassment is never a legitimate collection tool.