Emergency Loans and Other Convenient Ways to Borrow Money


Published on: April 29, 2020 Last updated: April 21, 2021

Emergency Loans and Other Trusted Pautang in Philippines | Moneymax

This article was originally published on July 3, 2018 and was updated on April 29, 2020.

Utang” is so strongly embedded in the Filipino culture that only two in every 10 adults in the country don’t borrow money, according to the Bangko Sentral ng Pilipinas (BSP) financial inclusion survey[1]. There are many ways to do exactly that, the most common of which are emergency loans and personal loans. It’s important to understand the benefits and risks of each loan options before choosing the right one for your immediate need. Here are just some of them.

Emergency Loans

Emergency loans provide a quick and easy way for cash-strapped Filipinos to fund any unexpected expense. They’re particularly helpful when you need money to rebuild your home or repair your car after a flooding, fire, earthquake, or any disaster. Most emergency loans in the Philippines come from three sources: private lenders, government agencies, and employers

Emergency Loans from Private Lenders

Emergency Loans in the Philippines - Private Lenders

Photo from US Special Operations Command Pacific

Of the three common emergency loan providers in the country, private lenders have the simplest application process, as well as the fastest approval and fund release as they usually do not require a bank account. Many emergency loan applications can be filed online nowadays, after which you’ll know if you’re approved for the loan within 5 to 10 minutes. You can receive funds on the same day or even in a matter of minutes.

This is why emergency loans appeal to the unemployed and those with low income or poor credit history. Emergency loans for unemployed Filipinos are ideal for when you need cash ASAP but are likely to get declined by banks because you don’t have proof of income. Online lenders only require valid IDs and don’t usually ask for as many income documents as banks do.

Great as they may seem during dire financial situations, emergency loans are a notoriously expensive way to borrow money in the Philippines. Interest rates are between 1% and 1.5% per day, which translate into an annual percentage rate[2] of around 500% to as much as 3,000%.

Moreover, loan amounts are small. The highest amount you can borrow is PHP 20,000. Emergency loans also come with very short terms, usually 30 days, so you’ve got a very limited time to return the amount you borrowed plus the interest.

Emergency Loans from Government Agencies

Emergency Loans in the Philippines - Calamity Loans from Government

Photo by Department of Foreign Affairs and Trade via Flickr, Creative Commons

The SSS, GSIS, and Pag-IBIG Fund assist survivors of natural disasters in the Philippines through their respective emergency loans or calamity loans. If you live in an area officially declared under a state of calamity, you can apply for an emergency loan from one of these government offices.

Compared to private lenders, the SSS, GSIS, and Pag-IBIG Fund offer longer repayment terms and significantly lower interest rates. However, you must be an active member of these agencies with consistent contributions of at least six months to qualify for a loan.

Here’s a table that shows the key features of emergency loans from the three Philippine government agencies. For more details on how to apply for these emergency loans from Philippine government agencies, check out this primer[3].

Emergency LoansGSIS Emergency LoanPag-IBIG Calamity LoanSSS Calamity Loan
 Loan AmountPHP 20,000Up to 80% of the member’s Total Accumulated ValueOne monthly salary credit (MSC) up to PHP 20,000
Loan Term36 months24 months24 months
Annual Interest Rate6%5.95%10%

Read more:

Emergency Loans from Employers

Some companies in the Philippines offer emergency loans to their employees affected by calamities. Others provide these loans as part of their employee benefits package, in which their workers can avail of any time they need cash for emergencies.

Emergency loans from employers are cheaper compared to other lenders, as they don’t typically charge an interest. Repayments are also convenient and flexible since they’re deducted from an employee’s succeeding paychecks or from their 13th-month pay.

The company you’re currently working for may be offering an emergency loan program. Check with the HR department and take advantage of it.

Personal Loans

Emergency Loans in the Philippines - Salary Loans

If you need a bigger amount, you can always apply for a personal loan. Banks have strict requirements and credit investigation processes for borrowers who need cash for an emergency. Processing of loans takes longer than other lenders, typically from three to seven days. Personal loan providers need that much time to assess a borrower’s ability to repay a loan.

Read more: Do You Have Bad Credit? What to Know When Applying for a Loan

This may not be the best option if you need money immediately. Still, applying for a personal loan is a safe, legitimate, and affordable way to borrow money in the Philippines with their low interest rates and long repayment terms. To get you started, use an online comparison platform to compare all personal loan offers available.

Below is a list of trusted personal loan companies and their loan features. Compare your options and apply through Moneymax!

Personal Loan ProviderFeatures
Citibank Personal Loan
Get a Citibank Personal Loan with Moneymax
  • Fast approval time in as fast as 24 hours
  • Loan amount of up to P2 million
  • Flexible payment terms of up to five (5) years
EasyRFC Multi-Purpose Loan
Get EasyRFC Multi-Purpose Loan with Moneymax
  • Fast approval time in as fast as 24 hours
  • High loan amount of up to P150,000
  • Payment term of up to 12 months
SB Finance Personal Loan
Get SB Finance Personal Loan with Moneymax
  • Get approved within five banking days
  • High loan amount of up to P2 million
  • Flexible payment terms of up to 36 months
TALA Personal Loan
Get TALA Personal Loan with Moneymax

  • Fast approval time in as fast as 24 hours
  • Quick cash loan up to P15,000
  • 24/7 application using an Android phone

Salary Loans

Salary loans in the Philippines are quite similar to emergency loans from private lenders, as they both provide borrowers a quick and easy access to cash online. Their interest rates are also higher than personal loans from banks.

Salary loans have slightly higher loan amounts and stricter application requirements. Some lenders can lend you up to PHP 50,000 and require fewer income documents such as payslips and bank statements. And in today’s COVID-19 reality, salary loans have never been this useful.

You can apply for a salary loan online simply by visiting sites like Cash Mart and Vidalia or by downloading apps like the Tala Loan app.

Pawning or Sangla

Emergency Loans in the Philippines - Pawning or Sangla

Photo by Joelaldor via Wikimedia Commons

Like the 5-6 lending system, pawn loans or sangla is a popular way to get quick cash in the Philippines. This is especially true in rural areas where pawnshops outnumber banks and ATMs. If you need a source of quick cash for emergencies, all you have to do is to give collateral such as jewelry or gadgets.

No need for credit checks and income documents—just make sure your collateral is authentic and valuable. Pawnshops charge interest rates for as low as 1% over a one-month term. Note that pawning your valuable items can be risky. You might not get it back if you fail to pay the amount you borrowed within the loan term.

Read more: Know the Benefits and Risks Before Pawning Valuables

Borrowing from Family and Friends

Emergency Loans - borrow from family and friends

Pautang naman. Bayaran kita sa sweldo.” It’s that easy to borrow money from your loved ones when you need it. Your ever-reliable tita, brother, BFF, or teammate in the office is just a phone call or text message away. No documents required, no collateral needed, no interest to pay, and no payment due dates to worry about. You can just pay back what you owe when you can. No wonder that majority of Filipinos are indebted to their family, relatives, and friends.

Of course, this type of utang comes at a cost. Break your promise to return the amount you borrowed, and you’ll easily lose their trust and the chance to borrow from them again. As much as you can, avoid being too dependent on your loved ones to save you from financial problems. It isn’t worth all the conflict, drama, and stress that can ruin any relationship.

Read more: 

Final Thoughts

Have you tried borrowing money for an emergency? There’s no shame in asking for financial aid when the going gets tough. As long as you hold your end of the bargain and pay back what you owe, you’ll come out of these hard times unscathed. Start applying for emergency loans and personal loans the right way by being a realistic and responsible borrower.


Written By: