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Though the vast majority of lenders in the Philippines operate well within the law and adhere to ethical business practices, unfortunately, there are some companies who operate with the intention of making as much money as possible by exploiting potential customers. It can be easier than you think to fall foul of illegal loan providers but there are a few steps you can take to make sure the company you are dealing with are legitimate. Here’s Asteria’s guide to identifying and avoiding illegitimate lenders in the Philippines.

Check the company is legitimate

Other than the obvious tell-tale signs such as poor-quality content, badly constructed websites and vague or unclear terms and conditions, you can also check that a lender is genuine by finding out if they are legally allowed to operate in the Philippines. The following link can be used to help you search for lenders who are approved by the securities and lending commission:

This is the body who regulates the way lenders operate in this part of the world. If the loan company you are considering applying to does not feature on the list, be extremely careful and don’t submit any personal details until you’re sure they aren’t scammers.

One of the key pieces of information you need to look for is the registration number allocated to the lender by the securities and exchange commission. If you can’t find this anywhere on the site, proceed with caution and consider using an alternative provider.

Read the terms and conditions carefully

All loan providers will have a set of specific terms and conditions that you agree to when signing up to borrow funds. This usually involves information about default charges for late payments, interest rates and other essential information. If anything looks suspicious, trust your instincts and investigate. You can contact the loan providers directly to ask specific questions and if they’re legitimate, they will have no problems explaining their terms in more detail for you. If they are unable to do this do not respond, avoid using them at all costs.

Pay attention to customer reviews

The advantage of living with 24/7 connectivity in the 21st century is that customers can communicate with each other to recommend companies based on good quality service. They can also warn other people to avoid shady organisations who are operating outside of the law. Illegal lenders will often create fake reviews on their sites to make it look as if they are legitimate, so be wary of this. You can usually spot a fake review by the poor grammar and the stark contrast to other customer’s opinions. So, for example, if there are a string of 1-star reviews followed by one or two 5-star reviews, treat this lender with extreme caution.

Look out for poor quality websites

All professional lenders in the Philippines understand the importance of a professional quality website, so if you happen to notice things like poor spelling, low quality images and generally questionable workmanship, always investigate before deciding to make contact. Cybercrime is on the rise and its now possible for companies to set up websites for a matter of days, before removing them again, which makes it very difficult for the authorities to trace them.

Beware of unprofessional customer service teams

All professional lenders should have a team of customer service operatives who are happy to answer your questions. They should be knowledgeable, approachable and never make you feel as if you are asking for too much information. If you make contact with a potential lender and their customer service team are rude, inefficient or seem badly trained, take care, as this could be a tell-tale sign of an illegal lender.

Threatening or Unreasonable Behaviour

Unfortunately, this sort of thing can be commonplace among illegal lenders, especially when customers are unable to pay back what they’ve borrowed. Never tolerate behaviour that could be deemed as threatening and always report it to the authorities if you have any suspicion of wrongdoing.

Unusual Payment Practices

All registered and verified lenders in the Philippines operate under strict regulations that dictate how and when they can ask for payments from you. If lenders are asking for payments at unusual intervals or suggesting that you transfer money to them directly via PayPal or a similar service, double check that you are dealing with a legitimate company. Though some smaller loan providers may use options such as this, it is generally very rare, and most will use direct bank transfers instead.

Offers that seem too good to be true

Whether it’s an unusually generous rate of interest or a much higher figure than other lenders have offered you, if something seems too good to be true, it almost always is. Though there is competition between lenders, there is only so low they can go before a loan becomes unprofitable for them. This means that anybody who offers you a much lower interest rate than you have been quoted by other providers is most likely a scam artist or a criminal.

Negative Press

Illegal lenders are discovered all the time and thankfully, the press in the Philippines are quick to shame them publicly. Search for company names to check out their credibility before you decide to submit an application, otherwise you run the risk of becoming a victim of fraud, theft or worse. Though some companies may have experienced bad press unfairly, if there are more than one or two articles that mention the company unfavourably, definitely avoid them at all costs.


When applying for any kind of loan in the Philippines, take your time and check all of the points we have outlined above to ensure the company you are dealing with are legitimate. The authorities always do what they can to help you, but once you have succumbed to fraud, extortion or theft at the hands of unregulated lenders, it can be extremely difficult to recover your losses.

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