TIL

Truth in Lending Act

Legislation requiring full disclosure of finance charges to protect consumers and prevent uninformed credit use detrimental to the economy.

Finance Charge

Includes interest, fees, service charges, and other costs related to credit extension as defined by the Monetary Board of the Central Bank of the Philippines.

Creditor/CGEs

Individuals or entities engaged in extending credit, requiring the payment of a finance charge as part of the credit extension.

Required Information

Details that creditors must provide to borrowers before a credit transaction, including cash price, down payment, finance charge, and total amount to be financed.

Manner of Computing Interest

Calculation method for interest by registered CGEs based on the outstanding balance of the loan at the beginning of each interest or installment period.

Registration

Process for CGEs to register lending facilities with the BSP, demonstrating commitment to compliance, corporate social responsibility, and transparency.

Penalties

Consequences for creditors failing to disclose required information, including fines, imprisonment, and liability for attorney's fees and court costs.