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Bacolod City, Philippines Saturday, May 23, 2020
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Give borrowers time to settle
loans, lending firms told

 

The Securities and Exchange Commission (SEC) reiterated its directive to all financing and lending companies to give borrowers more time to settle their loans within the community quarantine period.

SEC Bacolod information officer, Clyde Padilla, said financing and lending companies should strictly comply with Section 4(aa) of Republic Act No. 11469, or the Bayanihan to Heal As One Act, its implementing rules and regulations, and other applicable laws, rules and regulations.

Section 4(aa) provides the president the power to implement a minimum 30-day grace period for the payment of all loans while the country battles the coronavirus disease 2019 pandemic.

The initial 30-day grace period shall automatically be extended if the enhanced community quarantine period is extended by the President pursuant to his emergency powers, a SEC advisory said.

All financing companies, lending companies and microfinance non-government organizations shall apply the mandatory grace period to all loans with principal and/or interest falling due between March 17 and May 31.

On May 6, the Inter-Agency Task Force for the Management of Emerging Infectious Diseases also issued Resolution No. 33, directing all banks, quasi-banks, financing companies, lending companies, and other financial institutions to count the grace period from the respective due dates of qualified loans or until such time that the community quarantine is lifted, whichever is longer.

Under the Bayanihan Act, refusal to provide a 30-day grace period shall be punishable with imprisonment of two months or a fine of not less than P10,000 but not more than P1 million, or both, at the discretion of the court.

“Any violation or noncompliance shall be dealt with to the full extent of the law,” the SEC warned lenders.

Padilla said SEC is currently investigating financing and lending companies that allegedly refused to comply with the law.*

 

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