The rise of digital lending platforms in the Philippines has made financial access faster and more convenient, especially for unbanked or underserved Filipinos. Yet, this convenience has come at a cost. Borrowers have reported experiences with hidden charges, abusive collection tactics, and online loan apps that violate their privacy. These issues exposed major loopholes in the country’s consumer protection framework – prompting lawmakers to act.
To safeguard the public from these exploitative practices, the government passed Republic Act No. 11765, also known as the Financial Products and Services Consumer Protection Act (FPSCPA), in 2022. This law is now fully in force as of 2025, and it gives Filipino financial consumers powerful protections and clearer legal rights, especially in the realm of online lending.
If you’re using loan apps, digital banks, or other online financial services, understanding your rights under the FPSCPA can help you make informed decisions, protect your data, and fight back against abusive practices.
Why RA 11765 Was Necessary: The Case for Stronger Financial Protection
Before the FPSCPA, consumer protection in the financial sector was scattered across different laws and agencies. While regulations like the Truth in Lending Act (RA 3765) and the Data Privacy Act (RA 10173) offered partial safeguards, none addressed the full scope of abuses emerging in the digital era. Borrowers had limited recourse, especially when dealing with shady or semi-legitimate online lenders.
RA 11765 fills that gap. It:
- Unifies Protection Efforts under a single legal framework applicable to all financial products and services – whether offered by banks, loan apps, or fintech firms.
- Empowers Regulators like the BSP and SEC with clearer authority to investigate, penalize, and shut down violators.
- Responds to Modern Risks like predatory online lending, data harvesting, unauthorized access to contacts, and digital harassment.
- Builds Consumer Trust by requiring transparency, ethical conduct, and respect for consumer rights from all regulated financial entities.
What the FPSCPA Guarantees: Your Rights as a Borrower
RA 11765 introduces a broad range of protections that every Filipino borrower should know. These rights are enforceable, and lenders must comply or face consequences – from fines to license revocation.
1. Right to Clear and Complete Information
Financial institutions must disclose all relevant information – including interest rates (especially the Effective Interest Rate or EIR), fees, loan terms, and the total cost – before you sign or agree to anything.
✅ What You Should Do:
- Ask for a complete disclosure statement before proceeding.
- Do not settle for vague or fast-talking agents. Clarity is your legal right.
- Remember: hidden charges or sudden changes in loan terms are prohibited.
2. Right to Fair and Ethical Treatment
You are protected from:
- Misleading ads or fake loan approvals
- Excessive or hidden fees
- Harassment during debt collection
- Discrimination or intimidation
This right ensures that financial providers engage in honest, respectful, and professional behavior.
✅ What You Should Do:
If you’re harassed by collectors, threatened publicly, or pressured unfairly – gather evidence and report it to the SEC or BSP. These are violations under the FPSCPA.
3. Right to Protection of Your Assets and Data
FPSCPA requires lenders to protect not just your money, but also your personal and financial information. Apps and companies are not allowed to access your contacts, photos, or messages without clear, voluntary, and informed consent.
✅ What You Should Do:
- Check permissions before installing a loan app.
- If an app accesses private data without consent, it’s a violation of both RA 11765 and the Data Privacy Act.
4. Right to Privacy and Confidentiality
Your personal data must be used only for legitimate, agreed-upon purposes. Loan apps cannot use your information to shame, harass, or coerce you – nor can they leak your data to third parties.
✅ What You Should Do:
- Avoid apps that ask for unnecessary access (like photo galleries or contact lists).
- Report privacy violations to the National Privacy Commission (NPC).
5. Right to Redress and Complaint Mechanisms
Perhaps the most empowering feature of RA 11765: borrowers now have a formal avenue for complaints. Financial service providers must have internal mechanisms for addressing consumer concerns – and regulators are mandated to act when complaints are raised.
Regulators can:
- Investigate your case
- Order refunds or compensation
- Penalize abusive or non-compliant lenders
✅ What You Should Do:
- Collect all documentation (loan terms, screenshots, payment records, chat logs).
- File a complaint with the SEC (for loan apps) or the BSP (for banks and e-money providers).
- Use this right promptly – especially if you feel scammed, overcharged, or harassed.
Who Enforces the FPSCPA?
The Act strengthens the authority of key government agencies:
🔹 Securities and Exchange Commission (SEC)
Regulates lending and financing companies, including online loan apps. Now has stronger powers to investigate, suspend, or shut down abusive lenders.
🔹 Bangko Sentral ng Pilipinas (BSP)
Supervises banks, digital banks (like Maya Bank, UnionDigital, CIMB), credit card issuers, and e-wallets. Enforces interest caps and consumer protection standards.
🔹 National Privacy Commission (NPC)
Ensures compliance with RA 10173 (Data Privacy Act). Works with SEC and BSP to hold loan apps accountable for privacy violations.
What FPSCPA Means for Legitimate Lenders
RA 11765 doesn’t just punish bad actors – it raises the bar for the entire industry. Legitimate financial providers must now:
- Create Clear Complaint Systems: Borrowers must know how to reach them and file disputes.
- Follow Ethical Business Practices: Deceptive marketing, unfair fees, and aggressive collections are no longer tolerated.
- Invest in Data Security: Lenders must proactively protect users’ information.
- Accept Accountability: Violations can result in fines, suspensions, or permanent shutdowns.
This raises consumer confidence and helps borrowers distinguish between legit and illegal online lenders.
How to Protect Yourself: Practical Tips for Borrowers in 2025
Staying informed is the best defense. Here’s how to use RA 11765 to your advantage:
✅ 1. Verify the Lender’s Registration
- Look up the lender on the SEC website (for loan companies) or BSP’s list (for banks and e-wallets).
- Avoid transacting with apps that aren’t registered – you may have limited legal protection.
✅ 2. Keep Documentation
- Save screenshots, receipts, and agreements. These are vital if you need to file a complaint.
✅ 3. Know Where to Complain
- SEC: Issues with loan apps, hidden fees, or abusive debt collectors.
- BSP: Problems with banks, e-wallets, or digital credit lines.
- NPC: Concerns about data misuse, privacy breaches, or app overreach.
✅ 4. Ask for Help
- Consumer groups, financial watchdogs, or even public attorneys (PAO) can help you assess your case.
Conclusion: Your Rights Are Now Law – Use Them
RA 11765 is a major leap forward in protecting Filipino borrowers from exploitation. As digital lending continues to evolve, so too must consumer awareness. This law isn’t just a legal document – it’s a powerful tool that gives you the right to transparency, fairness, privacy, and justice.
Whether you’re applying for a quick loan online or using a digital bank, you are no longer powerless. The FPSCPA puts the law firmly on your side.
Stay informed. Stay vigilant. And always demand the respect and protection you legally deserve as a financial consumer in the Philippines.
