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SSS Pension Loan – Money Lenders
These lenders are not part of SSS office nor accredited
by the SSS office. They are merely SSS pension loan
providers. Like mushrooms sprouting and spreading on
different odd places in the country, these are
non-banking financial institutions that
cater purely to Social Security System (SSS) members
only. Whether it is the member himself, his widower, and
or his children. As long as they are receiving the
pension,
they can avail of the loan.
For these institutions to guarantee payment on the loan
they ask for the pensioner’s
ATM card or if still available, the bank book, also
known as passbook of the pensioner. The ATM card or
passbook held as collateral, serves not only as such but
also as
control measure of the lender. The risk of
withdrawing it when pension payment comes. |
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The borrower cannot have the ATM card or
passbook until the credit or loan has been settled. In
so far, due to strictness of other lending institutions
to provide loans to pensioners, this is the easiest way
for them to borrow money. Because if they go to banks to
avail of loan, they would be having problems with the
requirements of documents since most of the pensioners
are old, still studying, widower has no source of funds
and therefore may not have enough documents and
identification cards to present. So, this is in present
a very thriving business in the country.
Individual Money Lenders
These lenders are not established as formal institution
nor accredited lenders from the government, but they
extend credit to people who they personally know. Some
of them do not make any contracts or whatsoever
agreement on paper to secure the loan. It’s just a
spoken promise by the borrower to pay the lender on a
future date.
Actually and informally, there are two types of
individual lenders. One of who lends only to help a
person in need, as in purely help a person, the other
who makes lending a business.
Those who lend only to help a person in need, maybe a
close friend of the lender, to whom the lender has
complete trust to. This type of lender maybe a relative,
brother, sister, a friend, or a friend’s friend of the
borrower. They lend without imposing interest and
without contract, just verbal agreement and promise of
the borrower that the borrowed cash would be paid on
future date. So sometimes, because there is no contract
that binds the borrowing, they unfortunately never get
paid.
While on the other hand, another type of individual
lender is one that makes lending money as a business.
And since government does not accredit them, they
usually impose exorbitant interest on the borrower. The
practice is called usury. In Philippines, it is most
commonly called as a person who offers 5-6. Usually, the
mode of payment for 5-6 is installment basis, per day,
per week or per month. It depends upon the lender’s
decision. This type of lender is very rampant in almost
every community. But due to ease in acquiring money from
this lender, and there are no documents needed to avail
of cash, the borrower tends to borrow from them even at
high interest.
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