AC1 NC 26SS

AN AC1 IIkING kA1LS CI IN1LkLS1 UCN LCANS AND DLCLAkING 1nL LIILC1 CI
kLCLIVING Ck 1AkING USUkICUS kA1LS AND ICk C1nLk UkCSLS


SLC1lCn 1 1he raLe of lnLeresL for Lhe loan or forbearance of any money goods or credlLs
and Lhe raLe allowed ln [udgmenLs ln Lhe absence of express conLracL as Lo such raLe of
lnLeresL shall be slx per cenLum per annum or such raLe as may be prescrlbed by Lhe
MoneLary 8oard of Lhe CenLral 8ank of Lhe hlllpplnes for LhaL purpose ln accordance wlLh
Lhe auLhorlLy hereby granLed

SLC1lCn 1a 1he MoneLary 8oard ls hereby auLhorlzed Lo prescrlbe Lhe maxlmum raLe or
raLes of lnLeresL for Lhe loan or renewal Lhereof or Lhe forbearance of any money goods or
credlLs and Lo change such raLe or raLes whenever warranLed by prevalllng economlc and
soclal condlLlons

ln Lhe exerclse of Lhe auLhorlLy hereln granLed Lhe MoneLary 8oard may prescrlbe hlgher
maxlmum raLes for loans of low prlorlLy such as consumer loans or renewals Lhereof as well
as such loans made by pawnshops flnance companles and oLher slmllar credlL lnsLlLuLlons
alLhough Lhe raLes prescrlbed for Lhese lnsLlLuLlons need noL necessarlly be unlform 1he
MoneLary 8oard ls also auLhorlzed Lo prescrlbe dlfferenL maxlmum raLe or raLes for
dlfferenL Lypes of borrowlngs lncludlng deposlLs and deposlL subsLlLuLes or loans of
flnanclal lnLermedlarles

SLC1lCn 2 no person or corporaLlon shall dlrecLly or lndlrecLly Lake or recelve ln money or
oLher properLy real or personal or choses ln acLlon a hlgher raLe of lnLeresL or greaLer sum
or value lncludlng commlsslons premlums flnes and penalLles for Lhe loan or renewal
Lhereof or forbearance of money goods or credlLs where such loan or renewal or
forbearance ls secured ln whole or ln parL by a morLgage upon real esLaLe Lhe LlLle Lo whlch
ls duly reglsLered or by any documenL conveylng such real esLaLe or an lnLeresL Lhereln
Lhan Lwelve per cenLum per annum or Lhe maxlmum raLe prescrlbed by Lhe MoneLary 8oard
and ln force aL Lhe Llme Lhe loan or renewal Lhereof or forbearance ls granLed ltovlJeJ
1haL Lhe raLe of lnLeresL under Lhls secLlon or Lhe maxlmum raLe of lnLeresL LhaL may be
prescrlbed by Lhe MoneLary 8oard under Lhls secLlon may llkewlse apply Lo loans secured by
oLher Lypes of securlLy as may be speclfled by Lhe MoneLary 8oard

SLC1lCn 3 no person or corporaLlon shall dlrecLly or lndlrecLly demand Lake recelve or
agree Lo charge ln money or oLher properLy real or personal a hlgher raLe or greaLer sum
or value for Lhe loan or forbearance of money goods or credlLs where such loan or
forbearance ls noL secured as provlded ln SecLlon Lwo hereof Lhan fourLeen per cenLum per
annum or Lhe maxlmum raLe or raLes prescrlbed by Lhe MoneLary 8oard and ln force aL Lhe
Llme Lhe loan or forbearance ls granLed

SLC1lCn 4 no pawnbroker or pawnbrokers agenL shall dlrecLly or lndlrecLly sLlpulaLe
charge demand Lake or recelve any hlgher raLe or greaLer sum or value for any loan or
forbearance Lhan Lwo and onehalf per cenLum per monLh when Lhe sum lenL ls less Lhan
one hundred pesos Lwo per cenLum per monLh when Lhe sum lenL ls one hundred pesos or
more buL noL exceedlng flve hundred pesos and fourLeen per cenLum per annum when lL ls
more Lhan Lhe amounL lasL menLloned or Lhe maxlmum raLe or raLes prescrlbed by Lhe
MoneLary 8oard and ln force aL Lhe Llme Lhe loan or forbearance ls granLed A pawnbroker
or pawnbrokers agenL shall be consldered such for Lhe beneflLs of Lhls AcL only lf he be
duly llcensed and has an esLabllshmenL open Lo Lhe publlc

lL shall be unlawful for a pawnbroker or pawnbrokers agenL Lo dlvlde Lhe pawn offered by a
person lnLo Lwo or more fracLlons ln order Lo collecL greaLer lnLeresL Lhan Lhe permlLLed by
Lhls secLlon

lL shall also be unlawful for a pawnbroker or pawnbrokers agenL Lo requlre Lhe pawner Lo
pay an addlLlonal charge as lnsurance premlum for Lhe safekeeplng and conservaLlon of Lhe
arLlcle pawned

SLC1lCn 4a 1he MoneLary 8oard may ellmlnaLe exempL from or suspend Lhe effecLlvlLy
of lnLeresL raLe celllngs on cerLaln Lypes of loans or renewals Lhereof or forbearances of
money goods or credlL whenever warranLed by prevalllng economlc and soclal condlLlons

SLC1lCn 4b ln Lhe exerclse of lLs auLhorlLy Lo flx Lhe maxlmum raLe or raLes of lnLeresL
under Lhls AcL Lhe MoneLary 8oard shall be gulded by Lhe followlng

1 1he exlsLlng economlc condlLlons ln Lhe counLry and Lhe general requlremenLs of Lhe
naLlonal economy

2 1he supply of and demand for credlL

3 1he raLe of lncrease ln Lhe prlce levels and

4 Such oLher relevanL crlLerla as Lhe MoneLary 8oard may adopL

SLC1lCn 3 ln compuLlng Lhe lnLeresL on any obllgaLlon promlssory noLe or oLher
lnsLrumenL or conLracL compound lnLeresL shall noL be reckoned excepL by
agreemenL ltovlJeJ 1haL whenever compound lnLeresL ls agreed upon Lhe effecLlve raLe
of lnLeresL charged by Lhe credlLor shall noL exceed Lhe equlvalenL of Lhe maxlmum raLe
prescrlbed by Lhe MoneLary 8oard or ln defaulL Lhereof whenever Lhe debL ls [udlclally
clalmed ln whlch lasL case lL shall draw slx per cenLum per annum lnLeresL or such raLe as
may be prescrlbed by Lhe MoneLary 8oard no person or corporaLlon shall requlre lnLeresL
Lo be pald ln advance for a perlod of more Lhan one year ltovlJeJ bowevet 1haL
whenever lnLeresL ls pald ln advance Lhe effecLlve raLe of lnLeresL charged by Lhe credlLor
shall noL exceed Lhe equlvalenL of Lhe maxlmum raLe prescrlbed by Lhe MoneLary 8oard

SLC1lCn 6 Any person or corporaLlon who for any such loan or renewal Lhereof or
forbearance shall have pald or dellvered a hlgher raLe or greaLer sum or value Lhan ls
herelnbefore allowed Lo be Laken or recelved may recover Lhe whole lnLeresL
commlsslons premlums penalLles and surcharges pald or dellvered wlLh cosLs and
aLLorneys fees ln such sum as may be allowed by Lhe courL ln an acLlon agalnsL Lhe person
or corporaLlon who Look or recelved Lhem lf such acLlon ls broughL wlLhln Lwo years afLer
such paymenL or dellvery ltovlJeJ bowevet 1haL Lhe credlLor shall noL be obllged Lo
reLurn Lhe lnLeresL commlsslons and premlums for a perlod of noL more Lhan one year
collecLed by hlm ln advance when Lhe debLor shall have pald Lhe obllgaLlon before lL ls due
provlded such lnLeresL and commlsslons and premlums do noL exceed Lhe raLes flxed ln Lhls
AcL

SLC1lCn 7 All covenanLs and sLlpulaLlons conLalned ln conveyances morLgages bonds
bllls noLes and oLher conLracLs or evldences of debLs and all deposlLs of goods or oLher
Lhlngs whereupon or whereby Lhere shall be sLlpulaLed charged demanded reserved
secured Laken or recelved dlrecLly or lndlrecLly a hlgher raLe or greaLer sum or value for
Lhe loan or renewal or forbearance of money goods or credlLs Lhan ls herelnbefore
allowed shall be vold ltovlJeJ bowevet 1haL no merely clerlcal error ln Lhe compuLaLlon
of lnLeresL made wlLhouL lnLenL Lo evade any of Lhe provlslons of Lhls AcL shall render a
conLracL vold ltovlJeJ fottbet 1haL parLles Lo a loan agreemenL Lhe proceeds of whlch
may be avalled of parLlally or fully aL some fuLure Llme may sLlpulaLe LhaL Lhe raLe of
lnLeresL agreed upon aL Lhe Llme Lhe loan agreemenL ls enLered lnLo whlch raLe shall noL
exceed Lhe maxlmum allowed by law shall prevall noLwlLhsLandlng subsequenL changes ln
Lhe maxlmum raLes LhaL may be made by Lhe MoneLary 8oard AoJ ltovlJeJ floolly 1haL
noLhlng hereln conLalned shall be consLrued Lo prevenL Lhe purchase by an lnnocenL
purchaser of a negoLlable mercanLlle paper usurlous or oLherwlse for valuable
conslderaLlon before maLurlLy when Lhere has been no lnLenLlon on Lhe parL of sald
purchaser Lo evade Lhe provlslons of Lhls AcL and sald purchase was noL a parL of Lhe
orlglnal usurlous LransacLlon ln any case however Lhe maker of sald noLe shall have Lhe
rlghL Lo recover from sald orlglnal holder Lhe whole lnLeresL pald by hlm Lhereon and ln
case of llLlgaLlon also Lhe cosLs and such aLLorneys fees as may be allowed by Lhe courL

SLC1lCn 8 All loans under whlch paymenL ls Lo be made ln agrlculLural producLs or seed or
ln any oLher klnd of commodlLles shall also be null and vold unless Lhey provlde LhaL such
producLs or seed or oLher commodlLles shall 6e appralsed aL Lhe Llme when Lhe obllgaLlon
falls due aL Lhe currenL local markeL prlce ltovlJeJ 1haL unless oLherwlse sLaLed ln a
documenL wrlLLen ln a language or dlalecL lnLelllglble Lo Lhe debLor and subscrlbed ln Lhe
presence of noL less Lhan Lwo wlLnesses any conLracL advanclng money Lo be repald laLer ln
agrlculLural producLs or seed or any oLher klnd of commodlLles shall be undersLood Lo be a
loan and any person or corporaLlon havlng pald oLherwlse shall be enLlLled ln case acLlon ls
broughL wlLhln Lwo years afLer such paymenL or dellvery Lo recover all Lhe producLs or seed
dellvered as lnLeresL or Lhe value Lhereof LogeLher wlLh Lhe cosLs and aLLorneys fees ln
such sum as may be allowed by Lhe courL noLhlng conLalned ln Lhls secLlon shall be
consLrued Lo prevenL Lhe lender from Laklng lnLeresL for Lhe money lenL provlded such
lnLeresL be noL ln excess of Lhe raLes hereln flxed f21q

SLC1lCn 9 1he person or corporaLlon sued shall flle lLs answer ln wrlLlng under oaLh Lo any
complalnL broughL or flled agalnsL sald person or corporaLlon before a compeLenL courL Lo
recover Lhe money or oLher personal or real properLy seeds or agrlculLural producLs
charged or recelved ln vlolaLlon of Lhe provlslons of Lhls AcL 1he lack of Laklng an oaLh Lo an
answer Lo a complalnL wlll mean Lhe admlsslon of Lhe facLs conLalned ln Lhe laLLer

SLC1lCn 9a 1he MoneLary 8oard shall promulgaLe such rules and regulaLlons as may be
necessary Lo lmplemenL effecLlvely Lhe provlslons of Lhls AcL

SLC1lCn 10 WlLhouL pre[udlce Lo Lhe proper clvll acLlon vlolaLlon of Lhls AcL and Lhe
lmplemenLlng rules and regulaLlons promulgaLed by Lhe MoneLary 8oard shall be sub[ecL Lo
crlmlnal prosecuLlon and Lhe gullLy person shall upon convlcLlon be senLenced Lo a flne of
noL less Lhan flfLy pesos nor more Lhan flve hundred pesos or Lo lmprlsonmenL for noL less
Lhan LhlrLy days nor more Lhan one year or boLh ln Lhe dlscreLlon of Lhe courL and Lo
reLurn Lhe enLlre sum recelved as lnLeresL from Lhe parLy aggrleved and ln Lhe case of non
paymenL Lo suffer subsldlary lmprlsonmenL aL Lhe raLe of one day for every Lwo pesos
rovlded 1haL ln case of corporaLlons assoclaLlons socleLles or companles Lhe manager
admlnlsLraLor or gerenL or Lhe person who has charge of Lhe managemenL or admlnlsLraLlon
of Lhe buslness shall be crlmlnally responslble for any vlolaLlon of Lhls AcL

SLC1lCn 11 All AcLs and parLs of AcLs lnconslsLenL wlLh Lhe provlslons of Lhls AcL are hereby
repealed

SLC1lCn 12 1hls AcL shall Lake effecL on Lhe flrsL day of May nlneLeen hundred and slxLeen

LnacLed lebruary 24 1916