President Duterte has ordered the deportation of Indian money lenders practicing the “5-6” scheme, a Cabinet member bared yesterday.
In a Facebook post, Department of Agriculture (DA) Secretary Emmanuel Piñol said the Chief Executive asked Foreign Affairs Secretary Perfecto Yasay to notify the Indian ambassador to the Philippines about the “usurious” money borrowing practices done by nearly 50,000 motorcyle-riding Punjabis all over the country.
“It’s too much. Allowing the 5-6 interest rate and then they will sell expensive appliances. It’s unfair to our poor people,” Piñol quoted Mr. Duterte as saying.
“They are violating Philippine laws by indulging in a money-making business without the necessary permits,” the President added.
The so-called 5-6 money-lending scheme is a common practice that forces borrowers to pay back a P5,000 peso loan with a P1,000 interest in one month collected on a daily basis.
Department of Trade and Industry (DTI) Secretary Ramon Lopez, during the same Cabinet meeting, said the apparently illegal lending practice is due to “the inability of government lending institutions to provide an easy access facility for small businessmen.”
As a response to the needs of small businessmen, the DTI designed a scheme on how to extend soft loans to small businessmen with an interest of 20 percent every year, payable in one year.
Moreover, the DA chief got the assurance from the President that farmers who are tied to the 5-6 lending scheme will have their problems eased through an initial release of P1 billion for a micro-lending program whose clients are mostly from the countryside.
Piñol said Mr. Duterte promised that as soon as the Philippine Charity Sweepstakes Office and the Philippine Amusement and Gaming Corporation turn over funds collected from their operations to the Office of the President, he would provide additional money for micro lending program in all regions.
Meanwhile, Justice Secretary Vitaliano Aguirre II yesterday said the full force of the law will come down on Indians engaged in usury.
Aguirre said President Duterte instructed Cabinet members to come down hard on lending schemes and wants Indians engaged in such business arrested by police and deported to their country.
“They can be arrested for operating without any permit,” Aguirre stressed.
The Justice secretary explained the Indians could be arrested even in the absence of warrant of arrest from courts because such offense is considered as a continuing crime.