Lending Company Philippines
Since loans are used by the majority of Filipino customers, it’s a good idea to know how lending firms work. The basics are clear. The companies grant funds to people and entities but require to return the full amount within the agreed terms. Moreover, credit lending companies charge interest rates – extra fees that clients pay for using these funds.
But what exactly is a lending company? What are the main features of these businesses? Here, we want to answer these and other primary questions. To avoid information overload, we will mention only the most significant facts about Filipino lenders. For more detail, you can explore the SEC’s site.
Well, officially, a trusted lending company in Philippines is an entity that operates under Act #9474. It can provide loans using its own capital or using personal funds of up to 19 investors. Interestingly, lending corporations are regulated not like banks, financing companies, and other credit groups. Lenders can provide loans only.
Further, you can check the most distinctive features of these FinTech companies:
- Capitalization. The minimum required capitalization is set at P1,000,000 for the whole company. Separately, branches must feature capitalization of P300,000 for first-class areas, P150,000 — for second-class ones, and P75,000 — for municipalities.
- Certificates. Apart from the SEC-issued license, an offline or online lending company must obtain a certificate for the main office and each branch. Without this, a company can’t operate legally.
- Legal entity type. Nowadays, all lending firms must be stock corporations. Other forms like partnerships are prohibited. The existing companies of other entity types have one year to change the form and comply with the rules.
- Name. Due to the fact that lending corporations are regulated individually, their names should feature the words that describe their primary activity. Moreover, the use of words related to financing firms is prohibited.
- Stockholders. The major share of voting stocks should belong to Filipino citizens only. Other stocks can be owned by foreigners but only if their nations have reciprocal rights with the Philippines.
Surely, all top lending companies in the Philippines should keep books of accounts and submit financial statements to the SEC. They also have to agree on the loan terms & conditions with each borrower before providing funds. Violations of these rules lead to fines between P10,000 and P50,000 and/or imprisonment between 6 months and 10 years.
Regardless of the official name/type, we list different lending, financing, and banking corporations. You can compare their offers using a simple interface. Don’t hesitate to contact us if you need more information related to the legal rights of lending firms. As well, we’re ready to help with loan selection and application processes.
Loan Companies Online
When it comes to the application ways, there are two key options: offline and online. The first one is familiar to everybody. To get money, a borrower should visit any office of the chosen lender, get the paper form, fill it out, and submit personally along with the requested documents. This way is traditional but not the most efficient. Modern lending businesses try to add other channels, i.e. digital or online ones.
If you want to find the best lending company Philippines, look for firms with online application/delivery options. There are two categories of these entities:
- Traditional firms. The majority of Filipino lending groups combine physical and online interaction channels. For instance, they allow submitting applications personally or via official sites. Some companies may allow online applications but require a personal meeting to get cash while others feature in-office requests but deliver the money online. So, it’s up to you to choose the type.
- Online-only startups. These companies don’t have branches at all. They accept requests, process them, and disburse loans online. Some companies like Tala or Atome Credit opt for a more digitalized approach as they offer app-only interaction. Anyway, if you want to get bad credit loans online, don’t have enough documents for banks or just prefer digital communication, choose this category.
Thus, it’s crucial to understand the difference between banks with online interfaces and online-only companies. The first type refers to traditional lending. Banks and large corporations deliver huge amounts and often charge lower interest rates. However, they feature stricter approval processes and a lot of requirements: employment proof, payslips, etc. Also, banks tend to process requests longer than their online competitors.
On the contrary, FinTech reviews show that online lenders target customers who can’t meet the requirements of traditional lending firms. Startups may offer lower amounts but they also have favorable requirements (often, it’s enough to submit a valid ID) and a faster approval. These companies try to process each loan within 24-48 hours. If you prefer online interaction and know the basic rules of Internet hygiene, these companies will suit you.
In our list of lending companies in the Philippines, we mention both categories. If you want to work online with banks, explore offerings from Citibank, Home Credit, HSBC, BDO, BPI, EastWest Bank, Security Bank, RCBC, UCPB, and others. If you trust innovative online firms, pay attention to Asteria, Tala, Atome Credit, Cashwagon, FundKo, First Circle, RFC, Global Dominion, Kiva, etc. Don’t forget to read customer feedback to deal with reliable companies only. Of course, all of them must be registered with the SEC.
List of SEC-Registered Online Lending Companies
What’s the main red flag when it comes to online lending? Lack of licensing. Every lending company must obtain an official SEC-issued license to operate in the country. That’s why it’s crucial to check legal documents of each easy cash lending company Philippines. Exploring the official site is the simplest way to do this.
The SEC is a governmental body that registers and controls loan corporations. The SEC-registered online lending companies feature six parameters:
- Name. It’s the official company name that is mentioned in the registration documents. Note that public names and official names may differ significantly. For instance, Atome Credit is registered as Neuroncredit Financing Company.
- Registration number. Each legit micro lending company Philippines has this number. Usually, it starts with “CS” and followed by nine digits. The number allows finding the company you’re interested in easily.
- Certificate number. All lenders have to get this additional document apart from the government-issued license. Thus, if a lender doesn’t have a certificate, it operates illegally.
- Registration date. Each lending company Philippines without collateral has this number, as well as other mentioned features. The date shows when the firm got its license.
- Interest rates. This line is one of the most useful, probably. The SEC has the right to define interest rates for each lender. Thus, if a lending company exceeds the upper level in fees, it violates the official rules and can be penalized. General rates are from 2% to 5%.
- Term. Here, you can find how the interest is calculated. For instance, there are companies that charge interest rates per month and those that do this per day or even per annum.
Apart from the aforementioned list, the SEC also has a separate catalog of financing companies. The catch is that lending and financing groups are regulated differently so they are placed in different lists. You can find the best personal loan lenders in both sections so explore both of them.
All in all, the SEC website is a great source of valuable information for Filipino borrowers. Using the site and/or custom requests, you can find whether the chosen lender is licensed, which number it has, how the government works with lending groups in general, whether it provides unsecured bad credit loans, and so on. Note that we list only officially registered companies so all of them are legit.