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The government is stepping up the crackdown on foreigners engaged in the notorious 5-6 money lending scheme to ease the suffering of borrowers especially the poor.
President Duterte has ordered the arrest and deportation of the foreigners involved in the dubious money lending scheme, according to Agriculture Secretary Emmanuel Piñol.
“Sobra na yan. Pautangin ng 5-6 (interest rate) tapos bentahan pa ng mahal na mga appliance. Patay talaga ang pobre dyan,” Piñol quoted the President during the Cabinet meeting last Monday.
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,” 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 everyday.
“The very high interest rates, however, have resulted in hardships for the borrowers who could hardly pay up the loans,” the agriculture secretary said.
To curb dependence on dubious money lending scheme, Piñol said the government has set aside an initial P1 billion to provide easy access to loans to small businessmen.
He said 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 the national government.
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. (GENALYN KABILING)