Alternatives to Loan Sharks: Access to Affordable Lending

Getting money when you need it is crucial, that’s why many end up seeking help from loan sharks or informal lenders. It’s a troubling situation that many Filipinos face as these lenders often charge excessively high interest rates, and resort to aggressive tactics to reclaim their money. Sadly, as tempting as they can be with their “quick” solutions, it may bring you more harm than good.

That’s why understanding the risks, and exploring alternatives are important.

Understanding Informal Lenders

Family and friends, as well as “5-6” lending schemes, are informal sources that are chosen because they offer immediate access to funds as opposed to formal sources, where the credit evaluation procedure typically takes longer. Additionally, because tiny amounts can be paid on a daily or weekly basis, the payment terms permitted by informal sources better fit the ability of borrowers to pay.

  1. No Legal Safety: Informal lenders don’t play by the rules of financial institutions, so you might have no legal backup if things go wrong.
  2. Unclear Rules: They usually don’t put things in writing, which can lead to misunderstandings.
  3. No Regulations: They don’t always follow the legal way of lending, and that can lead to stressful debt collection.
  4. Limited Solutions: If you encounter an issue with them, finding help might be challenging.

Why Some Turn to Loan Sharks

  • Urgency: When in urgent need of cash, you might see loan sharks as the quickest solution.
  • Limited Options: Some, especially those in underserved areas, lack access to regular banks, and see loan sharks as their only choice.
  • Speedy Approval: Loan sharks often approve and provide money swiftly, which can be tempting during crises.
  • Informal Process: Borrowers might prefer informal lending because it’s less complicated, needing less to no requirements.
  • Lack of Awareness: Some don’t fully grasp the risks linked to loan sharks, putting themselves in vulnerable situations.

While these might lead people to loan sharks, there are significant risks to consider:

  • High Interest: Loan sharks charge extremely high interest rates, creating debt that’s hard to repay.
  • Intimidation: When unable to repay, loan sharks may resort to aggressive texts, calls, and even visits to you and even your contacts to demand for payment.
  • No Legal Safety: Borrowing from loan sharks is risky; there’s no legal protection if things go wrong.
  • Hidden Fees: Loan sharks often conceal extra charges, surprising borrowers with unexpected costs.

Loan Alternatives 

  1. PAG-IBIG Multi-Purpose Loan: The government offers help through programs like PAG-IBIG. This loan is designed to assist qualified Pag-IBIG Fund members during financial emergencies, letting them borrow up to 80% of their total Pag-IBIG Regular Savings. To qualify, members must have paid at least 24 monthly membership savings, and have one monthly membership savings within the last six months prior to the loan application. 
  2. Trusted Banks: Traditional banks provide various loan options, such as home loans, auto loans, salary advance loans, installments, OR/CR sangla and personal loans. Consulting with your bank can help you explore the right choice for your financial needs.
  3. Financing Institutions: Alternatively, there are financing companies that you may apply to. They’re regulated, safe, and offer a range of loan products tailored to your needs such as, but not limited to, home loan, auto loan, personal loan, and more.


Loan sharks and informal lenders may offer quick fixes, but the risks of borrowing from them outweighs the benefits. By choosing a reliable and caring financial partner, you can get the help you need without adding unnecessary stress to your life.

At SB Finance, we aspire to be the launchpad for your dreams, providing caring and responsible assistance when you need it most. We’re also registered with the Securities and Exchange Commission (SEC) and supervised by the Bangko Sentral ng Pilipinas (BSP), so we ensure to give you:

  • Fair Interest Rates: No excessive repayments, just reasonable rates
  • Guidance in Every Step: Dedicated customer service
  • Legal Protection: Your rights as a borrower are safeguarded by the law
  • Dependable Support: Legit loan services that are helpful, especially during financial emergencies

If you need help with your loan application, reach us via email (, our Customer Service hotline at (+632) 8887-9188, or Facebook Page (@SBFinancePH)

If you want an SB Finance Goal Consultant to guide you toward achieving your financial goal, simply answer this form, and we’ll be sure to reach out to you! 

Your right choice makes all the difference.

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