May 27, 2017, 2:15 pm
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1 Philippine Peso = 0.07372 UAE Dirham
1 Philippine Peso = 2.41289 Albanian Lek
1 Philippine Peso = 0.03568 Neth Antilles Guilder
1 Philippine Peso = 0.32234 Argentine Peso
1 Philippine Peso = 0.02694 Australian Dollar
1 Philippine Peso = 0.03594 Aruba Florin
1 Philippine Peso = 0.04014 Barbados Dollar
1 Philippine Peso = 1.61883 Bangladesh Taka
1 Philippine Peso = 0.03501 Bulgarian Lev
1 Philippine Peso = 0.00757 Bahraini Dinar
1 Philippine Peso = 34.21016 Burundi Franc
1 Philippine Peso = 0.02007 Bermuda Dollar
1 Philippine Peso = 0.02775 Brunei Dollar
1 Philippine Peso = 0.1385 Bolivian Boliviano
1 Philippine Peso = 0.06559 Brazilian Real
1 Philippine Peso = 0.02007 Bahamian Dollar
1 Philippine Peso = 1.29566 Bhutan Ngultrum
1 Philippine Peso = 0.20514 Botswana Pula
1 Philippine Peso = 401.84665 Belarus Ruble
1 Philippine Peso = 0.0401 Belize Dollar
1 Philippine Peso = 0.02701 Canadian Dollar
1 Philippine Peso = 0.01958 Swiss Franc
1 Philippine Peso = 13.41871 Chilean Peso
1 Philippine Peso = 0.13757 Chinese Yuan
1 Philippine Peso = 58.49057 Colombian Peso
1 Philippine Peso = 11.65616 Costa Rica Colon
1 Philippine Peso = 0.02007 Cuban Peso
1 Philippine Peso = 1.98153 Cape Verde Escudo
1 Philippine Peso = 0.47496 Czech Koruna
1 Philippine Peso = 3.56443 Djibouti Franc
1 Philippine Peso = 0.13368 Danish Krone
1 Philippine Peso = 0.94018 Dominican Peso
1 Philippine Peso = 2.17375 Algerian Dinar
1 Philippine Peso = 0.28102 Estonian Kroon
1 Philippine Peso = 0.3623 Egyptian Pound
1 Philippine Peso = 0.45965 Ethiopian Birr
1 Philippine Peso = 0.01796 Euro
1 Philippine Peso = 0.04169 Fiji Dollar
1 Philippine Peso = 0.01563 Falkland Islands Pound
1 Philippine Peso = 0.01565 British Pound
1 Philippine Peso = 0.08608 Ghanaian Cedi
1 Philippine Peso = 0.90225 Gambian Dalasi
1 Philippine Peso = 182.35648 Guinea Franc
1 Philippine Peso = 0.14716 Guatemala Quetzal
1 Philippine Peso = 4.09595 Guyana Dollar
1 Philippine Peso = 0.15642 Hong Kong Dollar
1 Philippine Peso = 0.46989 Honduras Lempira
1 Philippine Peso = 0.13267 Croatian Kuna
1 Philippine Peso = 1.33601 Haiti Gourde
1 Philippine Peso = 5.51927 Hungarian Forint
1 Philippine Peso = 267.16178 Indonesian Rupiah
1 Philippine Peso = 0.0717 Israeli Shekel
1 Philippine Peso = 1.29566 Indian Rupee
1 Philippine Peso = 23.70534 Iraqi Dinar
1 Philippine Peso = 651.18426 Iran Rial
1 Philippine Peso = 2.00763 Iceland Krona
1 Philippine Peso = 2.60177 Jamaican Dollar
1 Philippine Peso = 0.01422 Jordanian Dinar
1 Philippine Peso = 2.23294 Japanese Yen
1 Philippine Peso = 2.06945 Kenyan Shilling
1 Philippine Peso = 1.36341 Kyrgyzstan Som
1 Philippine Peso = 81.17021 Cambodia Riel
1 Philippine Peso = 9.03573 Comoros Franc
1 Philippine Peso = 18.06503 North Korean Won
1 Philippine Peso = 22.47491 Korean Won
1 Philippine Peso = 0.00608 Kuwaiti Dinar
1 Philippine Peso = 0.01646 Cayman Islands Dollar
1 Philippine Peso = 6.21999 Kazakhstan Tenge
1 Philippine Peso = 164.1108 Lao Kip
1 Philippine Peso = 30.22079 Lebanese Pound
1 Philippine Peso = 3.06604 Sri Lanka Rupee
1 Philippine Peso = 1.82658 Liberian Dollar
1 Philippine Peso = 0.25943 Lesotho Loti
1 Philippine Peso = 0.06119 Lithuanian Lita
1 Philippine Peso = 0.01246 Latvian Lat
1 Philippine Peso = 0.02797 Libyan Dinar
1 Philippine Peso = 0.19607 Moroccan Dirham
1 Philippine Peso = 0.36395 Moldovan Leu
1 Philippine Peso = 1.10036 Macedonian Denar
1 Philippine Peso = 27.19791 Myanmar Kyat
1 Philippine Peso = 48.1935 Mongolian Tugrik
1 Philippine Peso = 0.16111 Macau Pataca
1 Philippine Peso = 7.18587 Mauritania Ougulya
1 Philippine Peso = 0.6951 Mauritius Rupee
1 Philippine Peso = 0.31052 Maldives Rufiyaa
1 Philippine Peso = 14.40426 Malawi Kwacha
1 Philippine Peso = 0.37051 Mexican Peso
1 Philippine Peso = 0.08565 Malaysian Ringgit
1 Philippine Peso = 0.25809 Namibian Dollar
1 Philippine Peso = 6.4432 Nigerian Naira
1 Philippine Peso = 0.6002 Nicaragua Cordoba
1 Philippine Peso = 0.16848 Norwegian Krone
1 Philippine Peso = 2.07648 Nepalese Rupee
1 Philippine Peso = 0.02843 New Zealand Dollar
1 Philippine Peso = 0.00773 Omani Rial
1 Philippine Peso = 0.02007 Panama Balboa
1 Philippine Peso = 0.06543 Peruvian Nuevo Sol
1 Philippine Peso = 0.06377 Papua New Guinea Kina
1 Philippine Peso = 1 Philippine Peso
1 Philippine Peso = 2.10277 Pakistani Rupee
1 Philippine Peso = 0.0752 Polish Zloty
1 Philippine Peso = 111.54155 Paraguayan Guarani
1 Philippine Peso = 0.07308 Qatar Rial
1 Philippine Peso = 0.08182 Romanian New Leu
1 Philippine Peso = 1.13952 Russian Rouble
1 Philippine Peso = 16.44902 Rwanda Franc
1 Philippine Peso = 0.07527 Saudi Arabian Riyal
1 Philippine Peso = 0.15837 Solomon Islands Dollar
1 Philippine Peso = 0.26825 Seychelles Rupee
1 Philippine Peso = 0.13368 Sudanese Pound
1 Philippine Peso = 0.17472 Swedish Krona
1 Philippine Peso = 0.02777 Singapore Dollar
1 Philippine Peso = 0.01563 St Helena Pound
1 Philippine Peso = 0.44572 Slovak Koruna
1 Philippine Peso = 150.54195 Sierra Leone Leone
1 Philippine Peso = 11.01967 Somali Shilling
1 Philippine Peso = 440.26096 Sao Tome Dobra
1 Philippine Peso = 0.17507 El Salvador Colon
1 Philippine Peso = 10.33681 Syrian Pound
1 Philippine Peso = 0.25802 Swaziland Lilageni
1 Philippine Peso = 0.68306 Thai Baht
1 Philippine Peso = 0.04816 Tunisian Dinar
1 Philippine Peso = 0.04615 Tongan paʻanga
1 Philippine Peso = 0.07172 Turkish Lira
1 Philippine Peso = 0.13487 Trinidad Tobago Dollar
1 Philippine Peso = 0.60472 Taiwan Dollar
1 Philippine Peso = 44.74107 Tanzanian Shilling
1 Philippine Peso = 0.5289 Ukraine Hryvnia
1 Philippine Peso = 72.26014 Ugandan Shilling
1 Philippine Peso = 0.02007 United States Dollar
1 Philippine Peso = 0.56624 Uruguayan New Peso
1 Philippine Peso = 76.29466 Uzbekistan Sum
1 Philippine Peso = 0.20022 Venezuelan Bolivar
1 Philippine Peso = 456.12204 Vietnam Dong
1 Philippine Peso = 2.15295 Vanuatu Vatu
1 Philippine Peso = 0.05162 Samoa Tala
1 Philippine Peso = 11.77599 CFA Franc (BEAC)
1 Philippine Peso = 0.0542 East Caribbean Dollar
1 Philippine Peso = 11.81574 CFA Franc (BCEAO)
1 Philippine Peso = 2.13228 Pacific Franc
1 Philippine Peso = 5.01706 Yemen Riyal
1 Philippine Peso = 0.25808 South African Rand
1 Philippine Peso = 104.16499 Zambian Kwacha
1 Philippine Peso = 7.26415 Zimbabwe dollar

Usury less usurious

Maybe it was another campaign promise. Let us now get rid of the 5-6 lenders. If it were a verbalized commitment, is it part of the three-fifths they say should not be taken seriously of every five too often blurted out from the presidential mouth?

The Executive command was to kill the spread of usurious lenders and effectively roll out a less predatory system of financial inclusion for those unable to access credit. Although the latter phraseology was not explicitly detailed in the prose we remember, somewhere buried in the crude and crass colloquialisms the word “usury” permeates.

Usury is a technical term. Three syllables long it encompasses complex issues from desperation to greed.  It has to do with credit as well as the abuse of credit. When the economy still had the Usury Law in effect, the word bore parameters delineating what was unconscionable against what was not.

Allow us to delve into the simplistic colloquialisms conjured that represent the popular definition of usury arrayed against the technical so that we might understand recent government initiatives ridding ourselves of it. 

This is especially important. One reason is the Duterte budget and the amount of taxpayer money within either as capital for inclusive growth or, as the previous administration’s concept of financial inclusion, a slush fund earmarked for controversial dole outs more politically motivated than developmental.

The cliche imagery of the usurious creditor is the eastern Indian national lending money to the desperate at a ratio of five is to six where for every P5 of principal, by the following day P6 is collected. 

Debtors are either too desperate, arithmetically-challenged, ignorant or plainly do not care that the nominal interest is actually 20 percent applied on a daily basis. Annualized and employing the Banker’s Rule of 360 days that’s effectively 7,200 percent.

In no universe can an interest charge of 7,200 percent be considered fair. If we pare the compounding periods down to a monthly basis the effective interest drastically falls to 240 percent. Still usurious by any standard. 

Those astronomical rates however matter little to desperate debtors. Never mind the arithmetic. The simplistic household economics is understandable where borrowers focus on cashflows instead. It is the maturity value that concerns them. Can they afford it? 

Unfortunately, under such shortcomings predatory creditors take liberties.

In contrast, loans granted by banks and financial intermediaries now charge less than 8 percent per annum and even less than half of that for prime borrowers depending on credit ratings, collateral business, securities pledged and a whole lot of other factors that operate between debtor, creditor and regulators. On these the requisite due diligence and documentation alone can easily overwhelm and effectively disenfranchise micro-, small and medium-scale borrowers from mainstream banking.

The gaps in financial inclusion are filled in by private lenders who provide expensive funds ranging from 12 percent to 15 percent. Interest reflects risk. The latter is however mitigated by a whole new set of criteria essentially skewed towards repayment. Lenders develop close relationships with borrowers albeit maintaining these ties as professional as possible. The success of this holistic approach is further enhanced by critical and aggressive collection systems that larger lenders cannot or do not engage in.

Soon in Tacloban the government will embark on an experiment hoping to kill the usurious 5-6 lending industry. The Department of Trade and Industry initially budgeted P1 billion to seed a government-sponsored funding program reportedly based on credit extended to the most needy at a monthly rate of 2 percent or 24 percent per annum.

Hopefully government has done its homework and has shed the curse of corruption and ineptitude. Note that 24 percent per annum is only a sliver below the 2.5 percent monthly interest charged on credit cards issued by global credit card companies that enjoy economies of scale.. 

Under the government program debtors charged those rates are far from prime. There lies the danger. Requisite documentation and securities likely to be foregone need to be replaced by in-depth, almost intrusive, due diligence efforts, the matching of capital with the requisites of borrowers and, perhaps most important, extremely critical and highly efficient collection systems. Unfortunately, depth and efficiency are alien concepts in the bureaucracy.

In the past 21 percent to 24 percent were once considered unconscionable although eventually these were adjudged reasonable by the Supreme Court in at least two jurisprudential instances, once in 1988 and again in 2006. While the usury laws are no longer in effect, in 2000 in a case involving a state lender, after considering the absolute amount of the principal relative to its  exponential and compound interest, the courts ordered reducing a rate of 18 percent down to 10 percent.

From the foregoing, do the math. High cost state-granted debt may still cause repayment defaults eventually inflicted on the taxpayer that provides the debt capital. Nearly double of the interest charged by small to medium scale private creditors, government’s 24 percent might still be prohibitive albeit a tad less usurious.
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