6 Best Ways to Borrow Money for Different Needs

Even the most financially responsible people will need to borrow money at some point. When that time comes, it's good to know the best way to borrow money so you can get the amount you need and pay the most competitive rates. 

Keep reading to learn legit options, including their pros and cons, so you can assess the risks and enjoy the best rates possible. 

6 Best Ways to Borrow Money in the Philippines

Not all loan products are the same. Whatever your reason for getting a loan, there’s a suitable product for it. Check out some of your best options if you need to borrow money: 

💸 Personal Loans from Banks

For those who need to borrow money in the Philippines, the first thing that often comes to mind is a personal loan from a bank. 

Banks offer personal, car, and home loans. If you need to inquire about a loan, bank personnel can assist you with the application process.

Moreover, banks usually offer high loan amounts, low annual percentage rates,^[1] flexible payment options, and long payment terms. You also have the option to refinance an existing loan with better and more competitive rates, especially if you have a good banking relationship.  

Looking for options? Apply for a personal loan directly via Moneymax:

Provider	Loan Amount	Monthly Add-on Rate	Minimum Annual Income	Approval Time
UnionBank Personal Loan	Up to ₱2 million	1.29%	₱250,000	As fast as 5 minutes
UNO Digital Bank Personal Loan	₱10,000 to ₱200,000	2%	₱240,000	7 banking days
Metrobank Personal Loan	₱20,000 to ₱2 million	1.25% to 1.75%	₱350,000	7 banking days
BPI Personal Loan	₱20,000 to  ₱3 million	1.2%	₱180,000	5 to 7 banking days
RFC Loan	₱10,000 to  ₱150,000	4%	₱120,000	As fast as 24 hours
Tonik Credit Builder	Up to ₱50,000	Up to 4.91%	Inquire with Tonik	2 banking days
Tala Loan	₱1,000 to ₱15,000	15%	None	24 hours
HSBC Personal Loan	₱30,000 to ₱500,000	0.65%	₱168,000	5 to 7 banking days
CIMB Personal Loan	₱30,000 to ₱1 million	As low as 0.83%	₱180,000	2 banking days
Maybank Personal Loan	₱50,000 to ₱1 million	1.3%	₱300,000	5 to 10 banking days
RCBC Bank Personal Loan	₱50,000 ₱1 million	1.3%	₱360,000	5 to 7 banking days
SB Finance Personal Loan	₱30,000 to ₱2 million	2%	₱180,000	5 banking days
CTBC Bank Personal Loan	₱500,000 to ₱2 million	1.39% to 1.79%	₱180,000	1 to 5 banking days
PSBank Personal Loan	₱20,000 to ₱250,000	1.75% or 2.5%	₱180,000	5 to 9 banking days

Pros of Bank Personal Loans: 

• Well-established financial institutions offer this type of loan.
• You can get pre-qualified and approved for various loan products if you have a good credit score and an existing relationship with the bank.

Cons of Bank Personal Loans: 

• Expect higher application or servicing fees. 
• Bad credit makes it harder to qualify and get approved for a personal loan from a bank. 

Read more:

• Need a Financial Boost? Check Out These 19 Low-Interest Personal Loans
• 10 Best Personal Loans in the Philippines for Different Cash Needs

💸 Government Loans

If you’re looking for lower interest rates, longer payment terms, and almost guaranteed approval, look into government loans. Government agencies like the SSS, GSIS, and Pag-IBIG offer various loan programs for different purposes, including education, small business, emergencies, and home purchase, just to name a few. 

You can qualify for a government loan if you consistently and regularly pay your contributions and meet the required number of contributions. 

Applications can also be submitted online. Disbursement only takes a few days. 

Pros of Government Loans 

• They’re one of the easiest ways to borrow money because government loans don’t require a credit history or a credit check. 
• They offer interest rates lower than those of banks and private lending institutions. 

Cons of Government Loans

• If you get a loan from a government agency, you can only borrow an amount that matches your contributions. You won’t be eligible for a loan if you don’t meet the minimum number of contributions. 
• A government loan may not be the best option during an emergency as it takes several days to process. 

Related: SSS Salary Loan vs Pag-IBIG Multi-Purpose Loan: Which is Better?

💸 Salary Loan

If you’re employed, you can borrow money through your employer with a salary loan. Salary loans are an employee benefit that helps employees access cash quickly at affordable rates and convenient terms. 

Use a salary loan to fund a variety of needs. Choose from short or long-term loans with amounts and interest rates suited to various monthly salaries. Loan repayment is made via salary deduction. 

Pros of Salary Loans 

• There’s no minimum income requirement. As long as you’re employed as a regular or permanent employee, you can avail of a salary loan from your employer and pay your loan dues every payday.  
• You can apply by submitting a few requirements to your HR department, who will then process the loan. Once approved, you can receive the loan ASAP via your preferred disbursement method. 

Cons of Salary Loans 

• Not all companies offer a salary loan facility. 
• Salary loans are automatically deducted from your salary. This can strain your finances, especially if your monthly pay is already budgeted for different expenses. 
• If you miss a payment, it may cause problems with your monthly salary. 

💸 Online Lenders/Lending Apps

Need money ASAP? For a hassle-free application and fast loan disbursement,  get a loan via online lenders and lending apps.

Online lenders in the Philippines provide a quick and convenient funding process, minus the many application requirements and bank visits. Get the loan proceeds in as fast as 24 hours.

Online lenders make it possible for Filipinos with bad credit scores to borrow cash. This means that even if you can’t get approved for a bank loan, you have a high chance of getting approved by online lenders.  

Pros of Online Lenders/Lending Apps 

• The process is easier and simpler since you can apply online, which is advantageous for borrowers with busy schedules. 
• They offer faster approvals and loan processing than traditional banks. You can receive the loan proceeds quickly and fund an urgent need. 
• Online lenders consider a wider range of credit histories. Even with bad credit, you’ll likely get approved by an online lender.  

Cons of Online Lenders/Lending Apps 

• While fast and convenient, online lenders charge higher interest rates than traditional banks. Some also have shorter repayment periods.  
• Not every online lender or app you see is trustworthy. While some are backed by trusted and recognizable financial institutions, others are relatively new and require a more thorough background check. 

Read more:

• 16 Loans With Easy Application and Approval in the Philippines
• Borrow Easily: How to Get Cash Loans Without a Bank Account

💸 Credit Card Cash Advance

You can also get cash from your credit card when you’re in a bind. With a cash advance, you can withdraw money instantly from your available credit card limit online or through an ATM. There’s no need to fill out an application form and wait for it to be approved and processed. 

A cash advance is suitable for minor cash flow problems. You can easily repay what you borrowed on your next credit card due date. 

Pros of Cash Advance 

• It’s a fast and easy way to get instant cash. 
• You don’t need to pay interest on a cash advance if you fully pay your credit card bill. 
• Unlike personal loans, there are no application fees. Still, you will be charged a cash advance fee. 

Cons of Cash Advance 

• You might end up paying too much in interest if you allow your credit card balance to compound. 
• Your cash advance will reduce your credit limit. This is tricky if you need to make a major purchase. 

💸 Pawnshops

Another quick and easy way to borrow money in the Philippines is through a pawnshop loan. Just put up a collateral, like a gadget, a piece of jewelry, or a designer purse. The pawnshop will assess your collateral’s condition, resale potential, and value, then make a cash offer. 

You can collect your pawned item when you pay the loan on or before the due date. If you fail to repay, the pawnshop gets to keep your item. 

Pros of Pawnshop Loans 

• You don’t need to worry about your credit score. There’s no credit check or loan approval process involved—just your collateral. 
• Need cash fast? You can have it in minutes if you go to the nearest pawnshop. Bring collateral with a value similar to the amount you need to borrow. 

Cons of Pawnshop Loans 

• Although there are no hefty fees, you may also get charged with appraisal, storage, and insurance fees. 
• If your collateral isn’t deemed valuable enough, a pawnshop loan may not be enough to cover your cash needs. You might need to take out more loans.

A Quick Comparison of Best Ways to Borrow Money

To help you narrow down the best option for your needs and capabilities, check out this table:

Final Thoughts

The best way to borrow money varies for every individual. You need to consider why you need to borrow money and how much you need to borrow. 

All the options discussed in this article are excellent sources of funds. However, consider what each funding option is suited for so you can maximize the interest rates, loan terms, and other fees. 

Source: ^[1] Annual Percentage Rate (APR): What It Means and How It Works (Investopedia, 2024)