The Securities and Exchange Commission strongly urged all lending and financing companies to extend debt relief to borrowers to cope up with the impact of the coronovirus (COVID-19) pandemic.
The SEC in a notice dated March 23 said lending firms should consider offering debt relief measures to their borrowers, including lower interest rates, waiver or reduction of penalties, charges and other fees, loan term extension, suspension of collection, payment holiday and debt consolidation.
Financing and lending companies may also develop and implement their own programs or schemes that will provide financial relief to their borrowers.
The SEC, through its Corporate Governance and Finance Department, is also in discussions directly with financing and lending companies, which have been the subject of numerous complaints from the public, over the adoption of schemes that will help their borrowers.
“We call on financing and lending companies to adopt all possible measures that will help ease the burden of their borrowers amid this public health emergency, which has disrupted the everyday lives of Filipinos, including their livelihoods,” said SEC chairperson Emilio Aquino.
A number of financing and lending companies have already adopted debt relief measures.
The Philippine Finance Association informed the SEC that at least 18 of its members allowed the extension of payment deadlines on borrowers, without penalties and fees.
The SEC last year asked the Bangko Sentral ng Pilipinas to impose a ceiling on interest rates and other fees imposed by lending and financing companies amid complaints from the public.
The SEC said BSP should prescribe maximum rates, fees and other charges to avoid predatory lending.
A lending or financing company can freely set the interest rate and other charges on a loan, such as transaction fees and penalties for late payment.