BSP reviews microlending charges

BusinessWorld – THE BANGKO Sentral ng Pilipinas (BSP) is reviewing its rules and regulations on the disclosure of interest rates and fees and charges on microfinance loans to enhance the protection of clients.

“We are… looking at enhancing consumer protection against incomplete information on financial products or services being provided, non-transparency of fees and charges, and inappropriate sales techniques… to make sure microfinance clients are informed of the actual price of financial products or services,” BSP Governor Amando M. Tetangco, Jr. said last week at the Citi Microentrepreneur of the Year award.
In a telephone interview yesterday, Pia M. Roman, head of the central bank’s inclusive finance advocacy staff, said the BSP is consulting banks if it is possible to adopt a uniform way of computing the interest rates on all loans.
“What we are doing specifically is we are in the consultation phase with the banking community. We want to explore a uniform computation of interest rates for all loans using the declining balance method,” she said.

THE BANGKO Sentral ng Pilipinas (BSP) is reviewing its rules and regulations on the disclosure of interest rates and fees and charges on microfinance loans to enhance the protection of clients.

“We are… looking at enhancing consumer protection against incomplete information on financial products or services being provided, non-transparency of fees and charges, and inappropriate sales techniques… to make sure microfinance clients are informed of the actual price of financial products or services,” BSP Governor Amando M. Tetangco, Jr. said last week at the Citi Microentrepreneur of the Year award.

In a telephone interview yesterday, Pia M. Roman, head of the central bank’s inclusive finance advocacy staff, said the BSP is consulting banks if it is possible to adopt a uniform way of computing the interest rates on all loans.

“What we are doing specifically is we are in the consultation phase with the banking community. We want to explore a uniform computation of interest rates for all loans using the declining balance method,” she said.

Read the rest of the article on BusinessWorld online.