Tag Archives: about loan shark business

The Loan Shark’s Lending Facility in Philippines

pinoy loan sharks offering a bite

In my other article, I have provided a brief about Loan Sharks particularly operating in the Philippines.  I have not forgotten that I promised to bring you an idea how Loan Sharks are delivering their facility.

Unless you have made business with any of them before, you may still be wondering how things work in their business. In the said article I have also mentioned that it takes to be connected to people so you can be introduced to a Loan Shark.

I am providing you below the available means that a Loan Shark can be interested so your requirement for additional fund can be granted.   What is listed therefore provides idea of possible vehicle that you can consider to offer when you deal with a Loan Shark – and this however depends to their business interest and acceptance.

The facilities loan sharks may consider are:

  1. Check Discounting
  2. Collateral Loan that includes Estate, Vehicles, and any other valuable considerations
  3. Assignment of business receivables; i.e. account receivables from your customers
  4. Partial business ownership; i.e. offering him to own a certain percentage on any of your existing business

With the facilities mentioned above, the Loan Shark provides different bracket of interest rates.  This is due to fact that they have different priorities of acceptable guarantee on loans.   Since interest rate provided by Loan Shark is considerably high compared than commercial lenders, it would be wise for the borrower to consider this option last in the number of available alternative sources of fund.  I shall be providing you a number of alternatives you can consider ahead rather than going straight to a loan shark in another article I am writing soon.

Generally speaking, Loan Sharks operates because of the clear and present opportunity that another person is in-need fund and without the Loan Shark’s cold cash capital, there will be no business for them of this kind after all.  What beauty their business has is that their transactions do not pass along taxation.  This means they are not taxed for every interest income they gain from their borrowers.  It is because their transaction is considered under the shadow of the night since most of these loan sharks does not register for a business name for the said business nor declare their income for lending money.

On the other hand, a Loan Shark’s business is a high risk business compared than any other lending related business.  Since they are highly exposed to non-payment by borrowers up to going to the tedious process of filing legal complaints, they need to be very cautious in entertaining borrowers.  Background checking is always part of the process and having yourself endorsed by someone they knew already gives you an extra edge for approval consideration.

In another vantage view, some Loan Sharks are not actually the owner of the fund they are using.  They are just managing another person’s money and the money is from a person who may not want to appear publicly in this business.  Most of these financiers who use a representative are actually engaged in other forms of businesses: May the source of money comes in legally or otherwise.  In reality, Loan Sharks are just around the corner, in legit businesses, in big corporations, in the slums, and even in the government.