Debt Collection Harassment in the Philippines

Simplified Query: "Can a debt collection agency legally threaten to visit our Barangay?"

Debt collection practices in the Philippines are governed by various laws and regulations to protect consumers from unfair and abusive behavior by collection agencies.

Fair Debt Collection Practices

In the Philippines, debt collectors are expected to follow fair practices when recovering debts. The Bangko Sentral ng Pilipinas (BSP) has issued guidelines on fair debt collection practices, which are outlined in Circular No. 454. According to this circular, banks and their collection agents must avoid unfair and abusive debt collection tactics . The guidelines specify that:

1. Identity Disclosure: The debt collector must properly identify themselves and the company they represent when communicating with a debtor.
2. Harassment: Collection agencies are prohibited from harassing or abusing debtors. This includes threats of violence, profane language, or repeatedly contacting the debtor to annoy or abuse them .
3. Public Disclosure: Collection agencies are not allowed to make false public disclosures about a debtor’s debt, including through the Barangay.

Threatening Barangay Visits

Threatening to visit the Barangay to collect a debt or make public announcements about a debtor’s financial situation can be considered a form of harassment and public disclosure, which are prohibited practices under the BSP guidelines . Such behavior can also be considered a violation of a debtor's privacy and can cause undue embarrassment or harm.

What to Do if Harassed

If a debtor experiences harassment from a collection agency, they can take the following steps:

1. Document the Harassment: Keep records of all communications, including text messages, emails, and call logs.
2. Report to Authorities: Report the harassment to the BSP or file a complaint with the National Privacy Commission (NPC) if there is a privacy violation .
3. Consult a Lawyer: Legal counsel can provide guidance on how to deal with aggressive debt collectors and protect your rights.

Conclusion

Debt collection agencies in the Philippines must adhere to fair debt collection practices, and threatening to visit the Barangay or publicly disclose a debtor’s information is not permissible. Debtors who experience such behavior can take legal action to protect their rights and privacy .