President Duterte Orders Arrest, Deportation Of “5-6” Money Lenders In The Philippines
President Rodrigo Duterte and his
administration are stepping up its crackdown on foreigners engaged in the
notorious “5-6” money lending scheme to ease the suffering of poor Filipinos.
During Monday, January 9, Cabinet
meeting, Agriculture Secretary Emmanuel Piñol said President Duterte ordered
the arrest and deportation of foreigners involved in the dubious money-lending
scheme.
“That is already too much. They
lend you money with a “5-6” interest and sell appliances at a high price. The
poor can never survive that kind of scheme,” Piñol quoted the President.
The President has directed Foreign
Affairs Secretary Perfecto Yasay Jr. to inform the Indian Ambassador in the
Philippines about his decision “to stop the usurious lending scheme in the
Philippines,” Piñol said.
“They are violating Philippine laws
by indulging in a money-making business without the necessary permits,” President
Duterte said.
Piñol noted that around 50,000
motorcycle-riding Punjabis have been charging high interest rates in their
money lending offer to borrowers in the country. When a borrower owes a P5,000
loan, they are forced to pay P1,000 interest in a month collected every
day. A person who owes P1,000 under the
“5-6” scheme has to pay P30 a day for 40 days or a total of P1,200.
“The very high interest rates,
however, have resulted in hardships for the borrowers who could hardly pay up
the loans,” the Agriculture Secretary said.
Furthermore, Justice Secretary
Vitaliano Aguirre II said those engaged in the “5-6” lending scheme can be
arrested even without a warrant if they do not have business permit and other
government requirements.
The interest in the “5-6” lending
activity is legal after the repeal of the Usury Law and the removal of the
interest ceilings, he said, “but we could not accept that kind of interest. In
civil cases, the courts do not recognize that usurious interest rate.”
To curb dependence on dubious
lending schemes, Piñol said the government has set aside an initial P1 billion
to provide easy access to loans to small businessmen.
The President promised to allocate
additional funds for micro lending in all regions as soon as the Philippine
Charity Sweepstakes Office (PCSO) and the Philippine Amusement and Gaming
Corporation (PAGCOR) remit their income to the national government.
Moreover, Trade Secretary Ramon
Lopez has observed the “5-6” lending scheme has proliferated due to the
inability of government lending institutions to provide an easy access facility
for small businessmen.
“Sec. Lopez said DTI has already
designed a scheme on how to extend soft loans to small businessmen with an
interest of 20% every year, payable in one year,” Piñol said.
President Duterte Orders Arrest, Deportation Of “5-6” Money Lenders In The Philippines
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January 12, 2017
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