Philippines as a Creditor Nation. What??

I was surprised to read the news that the Philippines is now one of the creditor nations of the IMF. Wow! Since the country’s release from IMF-WB stranglehold in 2006, I didn’t realize that we’ve made much stride in terms of financial independence. Reports even stated that the Philippines attained creditor status when it bankrolled $251.5 million contribution to the coffers of the IMF for loan to needy countries and that half of the said amount has been availed already by Ireland, Portugal and Greece. This is welcome news indeed especially for a country with more than half of its citizens live by eating low quality rice and cheap instant noodles to get by.

With local small retailers and businesses folding up because of very slow domestic economic activity, the government saw it fit to bring out valuable dollars and loan it to other countries. One recent news report even revealed that the number of students enrolling in private schools and universities have gone down in the last few years while enrolment in public schools have gone up. If this is not enough news of how bad the local economy is and how majority of Filipinos are trying to make ends meet, then I don’t know what their barometer of a good performing economy is.

The Philippine government is trying to entice foreign businesses to invest in the local economy but has been successful only to a certain extent. We are still lagging behind other countries in terms of foreign investment and the meagre investment earned from those that indeed brought capital are not enough to prop up our sagging standard of living much more the government coffers. So where did the government get the money to invest in IMF? Thinking?

Yes, the VAT! Philippine government is raking in money in terms of VAT collections and the more the cost of fuel increases, the more VAT revenues they get. While we work hard to meet the needs of our family, the government is raking in billions of pesos in VAT collections. The sad part is the said revenue, instead of being used to prop up the local economy by creating jobs and other earning opportunities for Filipinos, is being taken out by the government to help other countries. They earn interest yes, but so little it’s not enough to help us. The only thing that the government will get out of it is a good image which unfortunately is not enough to impress foreign business investors because they know better. Is there anything you and I can do about it? Nothing! So while the government is trying to project a rich image abroad, lets stock up on instant noodles because prices are about to go up again soon.


Credit Card Debts of Filipinos – What to Do

A good number of Filipinos are neck-deep in worries when it comes to credit card debts. This is the result of many factors that include but not limited to failure to observe budgetary limitations, economic difficulties and also unforeseen events like sudden need for cash due to an emergency. Once the credit cards earn interests and the minimum payment required goes beyond your means, you can be sure to expect your debt to balloon beyond your imagination. So many charges are imposed by the bank and the collecting agency will also add to your worries because they will hound you in your home, office, and even go to your relatives if they happen not to find you. Some of them even go to the Barangay Office or pose as authorities like lawyers, police or sheriff just to get you to pay. This is actually illegal and they can be sued.

Now, a debt is a debt and I’m not saying don’t pay your obligations. But what if your back is already against the wall at talagang wala kang pambayad? What can you do? Give them your life? If by the stroke of some luck bigla ka nagkapera, you should still not pay them immediately because you can bargain that the interest charges be taken out of the entire amount, so you pay only the principal. But if you really have no money to pay then don’t bother because you have the following options:

Wala ka na nga pera pipilitin mo pa. Kahit sinkong duling di ka dapat magbayad pag talagang di kaya. Think first of your family and yourself. Even if you have credit card debts to settle, life goes on. Manage your finances and save money as if you have no debts. But don’t deposit your savings in the bank because they might reach it and freeze your account especially if the bank where you owe debt is also the same.

Do not be bullied by collection agencies. If you owe them P5M and you can only pay P2k a month then tell them that. DO NOT PAY initial amounts as much as possible and instead wait for the re-structured contract according to your terms before making any payments. If they don’t agree, then tell them to sue you instead.

These collection agencies act as though they own the banks and like you owe them personally. Remember that it is their livelihood and they earn money from collections. Without collections, they earn nothing. That’s why they’re eager to collect. But remember that it is not with them that you owe money so tell them to sue you in court if they dare. Tell them also that you will sue them if they spread any malicious information about you in your neighbourhood, office or relatives and friends. You still have rights just like everyone else. Marami pong may utang sa credit cards and hindi na kinakasuhan lolo na yung below P100k lang ang utang kasi lugi pa ang bangko sa abala pag nag-demanda sila. Dadaanin ka na lang sa pangungulit at pambabastos ng ibang collection agencies. Sila po dapat and i-demanda ninyo or ireklamo sa BSP, IBP at sa bank itself. More often banks are not privy to the scare tactics of their collection agencies so they should know about it. Write a complaint addressed to the bank and copy furnish the BSP. If it is a lawyer that’s harassing you, complain to the IBP or the Supreme Court and more often than not they are reprimanded or disciplined. Di ka na nga makatulog sa dami ng utang mo tapos tatakutin ka pa ng kung anu-ano na kaso…di naman tama yun.

Then so be it! Be sure that you have no properties that can be taken away from you. I’m sure you know how to do it. Just look at the properties of CJ Corona in the impeachment case filed against him. Wala mahabol ang prosecution na properties in his name because it’s not in his name to begin with! Also, properties that are necessary for your livelihood cannot be taken away by the Court. If you have a taxi, jeepney, or even desktop computer being used to earn a living, they cannot take that away from you. Also, courts are generally inclined to pity the debtor especially if you did not defraud the banks. There is a world of difference between being a defaulter and a defrauder. In a court proceeding, the unconscionable charges will be taken away and you will end up paying only the principal plus a little penalty and you will pay according to your capacity not according to their demands. If an agreement to pay a certain amount is reached in court, make sure that you can pay the amount stated. That’s why it should be based on your means and the court will help you in deciding.

Wala po nakukulong sa utang! Lagi po nating tandaaan ito. Kaya po napakakulit ng mga collection agencies ay dahil yun lang ang magagawa nila, ang mangulit! Don’t even bother talking to them. Negotiate directly with the bank if you have the money. All the charges must be taken away and you can also pay in instalment up to 4 or 5 years in some cases. Mas gusto ng bank syempre na magbayad ka kaya papayag sila.

As long as you have not issued a check that bounced, you can dictate the terms of the agreement. Pay according to your means and not based on their dictates. Ikaw ang magbabayad at hindi sila kaya ikaw ang dapat magsabi kung magkano ang kaya mo even if it is below their expectations.

Credit card debtors cannot be criminally charged. The only and ultimate recourse of banks is to file a case of Collection for Sum of Money which is not enough to land you in jail. There will be sleepless nights and this is something that you have to endure as a defaulter but remember that there is an end to all your financial predicaments. Life must go on.