Lending Harassment Laws in the Philippines

Introduction

The rapid growth of digital lending platforms in the Philippines since 2018 has provided millions of unbanked and underbanked Filipinos with quick access to credit. However, this boom has been accompanied by widespread reports of predatory and abusive debt collection practices, including public shaming, death threats, morphed obscene photos, incessant calls to employers and family members, and the broadcasting of borrowers’ personal information on social media. These acts constitute lending harassment and are punishable under a combination of criminal, civil, administrative, and regulatory laws.

Primary Statutes Governing Lending Harassment

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

This is the single most important law currently governing lending harassment.

• Section 3 declares it the policy of the State to protect financial consumers from abusive, unfair, deceptive, and predatory acts or practices.
• Section 15 expressly prohibits financial service providers (banks, lending companies, financing companies, and their third-party agents) from engaging in unfair, deceptive, or abusive acts or practices (UDAAP).
• Section 23 mandates all BSP- and SEC-supervised entities to adopt Fair Debt Collection Practices in accordance with guidelines issued by the respective regulators.
• Violation of the FCPC Act is punishable by administrative fines of ₱50,000 to ₱10,000,000 per violation (Section 34) and may result in cease-and-desist orders, suspension, or revocation of license/authority.

Implementing regulations:

• BSP Circular No. 1161 (2023) – Guidelines on Fair Debt Collection Practices for BSP-Supervised Financial Institutions (BSFIs)
• SEC Memorandum Circular No. 3, series of 2024 – Adoption of Fair Debt Collection Guidelines for Lending and Financing Companies

2. Republic Act No. 10173 – Data Privacy Act of 2012

The most frequently violated law in lending harassment cases.

Lending apps typically require access to contacts, gallery, SMS, and location. Using these data to shame or threaten borrowers or their contacts constitutes unlawful processing of personal information.

Punishable by imprisonment from 1–6 years and fines of ₱500,000–₱4,000,000 (Section 25–32). The National Privacy Commission (NPC) has imposed multi-million-peso fines on numerous lending apps and has ordered the blocking of over 800 illegal online lending platforms since 2021.

3. Republic Act No. 10175 – Cybercrime Prevention Act of 2012

• Online libel (Section 4(c)(4)) – posting defamatory statements or morphed photos: 6 years and 1 day to 12 years imprisonment
• Cyber-threats and intimidation committed through ICT are punished one degree higher than the analogous offenses in the Revised Penal Code.

4. Revised Penal Code Provisions Commonly Invoked

Article	Offense	Penalty (as increased by RA 10951)	Typical Application in Lending Cases
282	Grave threats	Prisión correccional (6 mos–6 yrs)	“Papatayin kita kung hindi ka magbayad”
283	Light threats	Arresto mayor (1–6 mos)	Threatening to file a case or sue
286	Grave coercion	Prisión correccional (6 mos–6 yrs)	Forcing payment by threatening violence or harm
287	Unjust vexation	Arresto menor (1–30 days) or fine up to ₱40,000	Repeated calls/texts at odd hours, profane language
358	Slander by deed	Arresto mayor (1–6 mos)	Publicly shaming the borrower as “scam” or “bayarang utang”

5. Republic Act No. 9474 – Lending Company Regulation Act of 2007 and Its IRR

Only entities with SEC Certificate of Authority may engage in lending as a principal business. Operating without such authority is a criminal offense punishable by 1–10 years imprisonment and fine of ₱500,000–₱5,000,000 (Section 12).

Most abusive mobile lending apps are unregistered and therefore operating illegally ab initio.

6. Republic Act No. 11967 – Internet Transactions Act of 2023

• Section 31 requires all digital platforms (including online lending platforms) to register with the DTI.
• Prohibits unfair or unconscionable practices in e-marketplaces and e-lending platforms.
• Empowers the DTI, in coordination with SEC and BSP, to issue takedown orders against non-compliant platforms.

Specific Acts Considered Harassment (As Enumerated in BSP/SEC Guidelines and NPC Advisories)

The following collection practices are expressly prohibited:

1. Use of obscene, profane, or abusive language
2. Calls or messages before 6:00 a.m. or after 10:00 p.m. (BSP Circular 1161 / SEC MC 3-2024)
3. Contacting third parties (employer, family, friends) except for location information and only after exhausting reasonable efforts to contact the borrower directly
4. Disclosure of the debt to third parties (“pagsisiwalat ng utang”)
5. Public shaming via social media, tarpaulins, or group chats
6. Threatening violence, arrest, or criminal prosecution when no valid basis exists
7. Use of altered or morphed obscene photographs
8. Sending collection messages that appear to come from courts, police, or government agencies
9. Charging collection fees exceeding 10% of the amount collected (SEC guideline)

Remedies Available to Victims

Criminal Complaint

File directly with the Office of the City/Provincial Prosecutor for violation of:

• RA 10175 (cybercrime)
• Revised Penal Code (unjust vexation, grave threats, etc.)
• RA 10173 (data privacy)

No need for private lawyer; the State prosecutes.

Administrative Complaints

• SEC – for lending/financing companies and online lending platforms
• BSP – for banks and their collection agents
• NPC – for data privacy violations (online complaint portal available)
• DTI – under RA 11967 for digital platforms

Civil Action for Damages

File in Regional Trial Court for moral, exemplary, and actual damages plus attorney’s fees (Article 2219, Civil Code in relation to quasi-delict or crimes).

Awards in recent cases have ranged from ₱100,000 to ₱500,000 in moral damages.

Small Claims (up to ₱1,000,000 as of 2025)

Purely money claims arising from harassment may be filed as small claims action.

Notable Judicial Pronouncements

• G.R. No. 248955 – People v. Cacayuran (2022): Conviction for unjust vexation via repeated harassing calls/texts upheld.
• NPC Case No. 2021-01 series: Multiple lending apps fined ₱3–5 million each for unlawful processing of personal data for shaming campaigns.
• Supreme Court Administrative Circular No. 135-2023: Courts are directed to fast-track cases involving online lending harassment.

Current Enforcement Landscape (as of December 2025)

• More than 1,200 illegal lending apps have been blocked by the NTC upon NPC/SEC request since 2021.
• Over 800 criminal cases for online lending harassment have been filed nationwide (PNP-ACG data, 2024–2025).
• SEC has revoked the certificates of authority of at least 45 registered lending companies for violations of fair debt collection rules in 2024–2025.
• The Inter-Agency Council Against Predatory Lending (composed of BSP, SEC, DTI, NPC, DOJ, PNP) continues coordinated enforcement operations.

Practical Advice for Borrowers Facing Harassment

1. Do not delete messages or screenshots – preserve evidence.
2. Immediately report to the lending app’s grievance officer (required under law).
3. File simultaneous complaints with NPC (privacy.npc.gov.ph), SEC (fintech@sec.gov.ph), and PNP-ACG (via 1326 hotline or e-blotter).
4. Send a formal demand letter citing RA 11765 and the specific prohibited acts.
5. Negotiate only in writing; never pay “settlement fees” demanded by illegal collectors.

Conclusion

Lending harassment is not a mere collection tactic; it is a serious criminal and regulatory offense under multiple Philippine laws. The combined framework of RA 11765, the Data Privacy Act, the Cybercrime Law, and the Revised Penal Code provides robust protection to borrowers. Victims who come forward are almost invariably granted relief by prosecutors, regulators, and courts. The State has made it clear: no one may use fear, shame, or intimidation to collect a civil debt in the Philippines.