Are you willing to hand out your automated teller machine (ATM) card to a lender just to be able to take out loans to augment your needs?
A majority of borrowers do.
This was according to the results of the 2014 Consumer Finance Survey, which the Bangko Sentral ng Pilipinas conducted from July 2014 to end-January 2015 nationwide except in Leyte, which was devastated by Typhoon “Yolanda,” and the Autonomous Region in Muslim Mindanao.
Results of the survey showed one in seven households surveyed took various loans.
Aside from housing and real estate, motor vehicle, and credit card loans, the respondents availed themselves of personal, salary, multipurpose and business loans.
”These were used primarily for business start-ups and expansion, educational expenses, debt payments, medical, and house improvement expenses,” the report on the survey said.
Most of these loans were extended by money lenders, cooperatives, financing institutions, and state-owned Social Security System and Home Development Mutual Fund or Pag-IBIG Fund.
While some of these institutions do not require collaterals, some do.
The survey found out that the most popular collateral by borrowers are their ATM cards, at 39.9 percent. This system is known as “Sangla ATM.”
Under this scheme, borrowers surrender their ATM cards to the lenders, who are given the personal identification numbers of the cards. The borrowers can have their ATMs back once the lenders have collected the payments.
Other collaterals are land, 22.5 percent; appliances, 11.7 percent; vehicles, 7.7 percent; and harvest, six percent.
In terms of sources of housing loans, survey results showed that Pag-IBIG is the main go-to agency in Areas Outside the National Capital Region (AONCR) while it is the National Housing Authority for NCR.
Aside from these government agencies, the other sources of housing loans are banks and money lenders.
“Relatives and friends, and in-house financing and financing institutions also provided a significant portion of housing loans,” survey results showed.
Annual rates of the housing loans are mostly, at 50.8 percent, 10 percent and below, it said.
Most of the borrowers or 55.9 percent of the respondents pay their monthly amortization on or before the due date while the others pay late, it added.
