Category Archives: Banking

Grace Period for Loans Already in Effect: Implementing Rules and Regulations Issued by DOF

The grant of grace period for all loans, which is part of the emergency powers granted by Congress to the President, is now set for implementation. On 1 April 2020, the Department of Finance (DOF) issued the Implementing Rules and Regulations (IRR) of Section 4(aa) of Republic Act No. 11469, Otherwise Known as the “Bayanihan to Heal as One Act“. The salient points of the IRR (see full text) are as follows: 

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Implementing Rules and Regulations of Section 4(aa) of Republic Act No. 11469, Otherwise Known as the “Bayanihan to Heal as One Act”

[On 1 April 2020, the Department of Finance (DOF) issued the Implementing Rules and Regulations of Section 4 (aa) of Republic Act No. 11469, otherwise known as the “Bayanihan to Heal as One Act”. Refer to the extended discussion. Here is the full text of the IRR.]

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Suspension of Rents and Loan Payments During the Covid-19 Lockdown

To help address the national crisis brought about by the Coronavirus Disease 2019 (COVID-19), Congress granted temporary emergency powers to the President, through the “Bayanihan to Heal As One Act” (Republic Act No. 11469). This law already took effect but not self-executory, which is why on 28 March 2020, the President, through the Executive Secretary, issued a directive to implement the emergency powers. Among the matters covered by the temporary emergency powers is the suspension of rent and loan payments. 

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Electronic Clearing of Checks in the Philippines, Starting January 2017

[The Bangko Sentral ng Pilipinas (BSP) has approved the implementation of the electronic clearing of checks, starting January 2017. This will speed up the clearing of checks from 3 to 5 banking days, down to 1 day. Issuers must consider the faster clearing of checks to avoid bouncing checks. To assist in the dissemination of this information, we are reproducing the media release of the BSP.] Continue reading

No One can be Imprisoned for Non-Payment of Debt

Perhaps you’ve heard someone making threats to file criminal cases against debtors who fail to pay. On the other hand, perhaps you’ve heard about the rule that no one can be imprisoned simply because of a debt in the Philippines. The prohibition against imprisonment for a debt is a basic right enshrined in no less than the Philippine Constitution (Article III): Continue reading

Liability of a Co-Maker: Distinguished from Guarantor

Maybe you’ve been asked by a friend to sign as a co-maker in a loan. You’re then asked to sign a promissory note or a debt instrument which designates you as a co-maker. There should be no problem with this, as the principal is usually someone we know and trust. I’ve seen, however, co-makers being held liable because the principal debtor was not able to pay. We also have a number of queries related to this issue. So let’s have a brief discussion on the extent of a co-maker’s liability. Continue reading

Primer on the Credit Information System Act (RA 9510)

What is the policy behind the “Credit Information System Act”? This law, Republic Act No. 9510, is consistent with the need to establish a comprehensive and centralized credit information system for the collection and dissemination of fair and accurate information relevant to, or arising from, credit and credit-related activities of all entities participating in the financial system. A credit information system will directly address the need for reliable credit information concerning the credit standing and track record of borrowers. An efficient credit information system will also enable financial institutions to reduce their over-all credit risk, contributing to a healthier and more stable financial system. Continue reading