A global digital lending platform has expressed its support for the Bangko Sentral ng Pilipinas (BSP) campaign and a senator against exploitative money lending systems like the “sangla-ATM” scheme.
Such a modus operandi makes it more difficult for Filipinos with financial problems. The said anti sangla-ATM also aligns with the lack of laws regarding the continued exploitation of Filipinos in lending.
In the sangla-ATM system, borrowers pledge or use their ATM cards with informal financiers as collateral. Most victims of such schemes are senior citizens who receive monthly pensions from the Social Security System (SSS) or Government Service Insurance System (GSIS) and low-income workers. Usually, there is no signed contract or any formal agreement, so it is difficult for the victims to file a formal complaint with the authorities or the court.
“Loans should help, not hinder, borrowers from making productive use of their money,” said Bianca Villarama, Director for Regulatory and Privacy of Tala, a digital lending platform. “Sangla-ATM loans, which require borrowers to surrender their ATM cards and to share their ATM security codes, prevent borrowers from using their money freely and safely. Tala believes that borrowers should be trusted and empowered to make good financial decisions to improve their lives. Tala supports the government’s campaigns to restrict lending practices that physically put borrowers’ property in the hands of untrustworthy lenders.”
Campaign against ‘sangla-ATM’ gets support
Villarama added: “The loans should help and not hinder the borrowers so that they can use the borrowed money properly. In this system where they have to surrender their ATM card and its security code, borrowers are prevented from using their money safely and freely. Tala believes that borrowers deserve to have the confidence and power to make decisions about how they can develop their lives. Tala supports the government’s campaign to curb exploitative lending systems that put borrowers’ assets at risk.”
The BSP continues to warn the public of the dangers posed by sangla-ATM. This includes identity theft and fraud, which can result in the unauthorized use of borrowers’ personal data and bank account details that can potentially be used in fraudulent and criminal activities.
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