A Research Study about Private

Lenders of San Jose City

Sociology105

Thalia G. Roldan
ABSS 3-1

CHAPTER I
Introduction
The roots of lending can be traced back to the roots of civilization itself. The written loan
contracts from Mesopotamia that are more than 3,000 years old showed the development of a
credit system that included the concept of interest. Loans are very simple contracts with
remarkable properties. One person lends something to another with the promise that it will be
repaid in the future. The borrower suddenly has wealth, while the lender takes current wealth and
places it in the contractual equivalent of a time machine in order to transfer it to a future date
when he might better use it. For doing so, the lender is compensated with interest that makes him
better off than in the present.
During these hard times, a lot of people would seek the help of those engaged in
moneylending business. Its a way to help support their families, to support financial needs of
micro-entrepreneurs and to ease poverty. Informal money lenders are money lenders who are not
licensed to do money lending business. They are also called 5-6 money lenders and are well
known about this kind of informal lending business which is patronized by some microentrepreneurs and people who wants to put-up a new business in urban areas. 5-6 is the term
used in such a reason that they lend money. Micro-entrepreneurs are the most patronizing party
in this form of business because they are the ones who are in needs of financial capital for the
daily financing activities of their businesses. In order for us to understand and give us the idea
why do they are more preferred to borrow in Bombay than other formal institutions, the selected
researchers wish to understand and measure the effects of this form of business to them, the
advantages and the disadvantages. In order to find ways in understanding the behavior of microentrepreneurs and to identify and recommend solution for the problem encountered between
informal money lenders and micro-entrepreneurs.
Im sure a lot of you out there have heard of the pautang from the Bombay who carries
around a payong and rides a motorcycle. But how many of you really know how it works? 5/6
simply stated is you borrowing P5.00 and you have to repay at P6.00. This is effectively 20%
interest. The regular term is 1 month but some may be as short as 1 week. Some lenders offer
easy payment scheme of P20.00 per day for 30 days for every P500.00 pesos loan. This is why

so many Filipinos get tempted to borrow money with such an easy payment term. It is easy and
simply no paper works to fill-up compared to the banks or lending institutions.
There are both good and bad sides to this. Firstly, in annual terms, the interest is 20%
times 12 months which equals to 240% meaning if you borrowed P1,000.00 you pay back the
amount of P2,400.00 plus P1,000.00 principal in one year. No wonder why so many Bombays
go into this business. Its so lucrative. More than triple your money in a year. You really have to
use the money properly otherwise you will end up in deep trouble.
On the other hand, this is the only financial assistance small time business people in the
wet markets, or sari-sari store can get extra capital. If used properly, these small time
businessmen can actually turn-around the cash and make some profit until they can sustain and
grow their business. Try asking the sellers in the palengke and they will say that indeed these
Bombays have actually helped them in their business. So while there is still demand for 5/6,
this will still continue for the years to come.
Lending or pautang has been one of the major businesses producing income of the
Indian community here in the Philippines. The term 5-6 has been tagged to a person who lends
money, which is also commonly called BombayAn Indian national, typically wearing a
pagri or turban wrapped around the head, and riding on a motorbike, or sometimes walking with
umbrella. The practice of 5-6 has been around since the early 70s; but it was not quite popular
not until the usury law was made legally inexistent. The underground practice of 5-6 seemed
like gossip that only busybodies carry like disease to their immediate neighbors. But when the
fangs of the usury law were minified, 5-6 became nationally popularized not only to rural areas
but to the urban places as well. The practice of 5-6 lending was accepted to the extent of being
part of pinoy culture.
As a developing country, the Philippines has a large informal sector comprised of microenterprises. Many of these are severely resource-constrained small vendors operating in public
markets, whose survival in business relies heavily on access to financing. This usually comes
from the informal sector sector as well in the form of informal financiers called 5-6. Two types
of 5-6 financiers are found in Philippine public markets, each with a distinctive lending
mechanism, Filipinos and Indians.

This paper considers the implications of having different financiers contribute to the
development of micro-enterprises. I discuss Filipinos, but give central attention to Indian
financiers for several reasons. First, regarded as last resource lenders, this group is crucial to the
most marginalized micro-entrepreneurs. Second, a part of their lending money flows in from
India through informal channels, quite an interesting phenomenon in this part of the world.
And third, despite their importance to Philippine micro-enterprises, little has been written
about their financing practices. Since their purpose was to grasp the concept of both formal and
informal micro-financing institutions for the purpose of macro policy formulation, differences
across institutions by ethnicity were not highlighted. As a result, although Indian financiers are
widely known among Filipinos, studies regarding their business practices are virtually nonexistent.

Various Types of Lending

Aside from the usurious 20% interest, there are other modes of payment a lender has to choose
from.
Fix interest
Fix interest is the interest a lender puts on the amount borrowed. This is the most common form
of method that many private lenders practice. Depending on the amount to be borrowed, the
lender and the borrower usually make verbal agreement on how long would it take for the loan to
be paid. As an example, the borrower borrows 1,000 and promise to pay it within a period of 45
days. The lender can give an option of daily, weekly, or full-payment method schemeBombays
always opt to collect daily, for whatever reason, its more convenient for them.
Diminishing interest
Unlike fix interest, this kind of scheme is more considerable, sometimes, favorable for the
borrower. The concept is that the borrower, who chooses to pay on a monthly installment basis,
will pay the capital but the interest will reflect based on the outstanding balance.

This payment method is similar to a credit card payment scheme where the outstanding balance
will accrue interest until the balance is not fully paid. It will take seven months for the borrower
to settle his/her debt should he/she chooses to stick with 300 per month. The lender will be
accumulating 808.41 interests in seven months. This can be avoided if, however, the borrower
with settle the debt not more than two months.
Incremental interest
This kind of payment scheme forces the borrower to settle his/her debt as soon as possible to
avoid paying double the amount of what he/she borrowed. This will secure the lender continuous
profit while the principal (money) is in the borrowers possession. The lender could start with 3%
interest and increments 1% every month.
Recurring interest
Recurring interest are often practiced in both public and private offices where the lender will
collect the agreed interest until the lender has not paid his/her debt in outright payment. Outright
payment means the lender will not accept installment payment but rather chooses to receive the
lent money in full. This is similar to a pawnshop method of pawning.

Statement of the Problem

In order to state the whole coverage of the study, researcher formulates problems related to the
effectiveness of informal money lenders, especially the so-called 5-6. It will pave the way to
gathering data and analysis of data gathered about the said topic. The stated problem will be the
guide of this study.
General Problem:
The main purpose of the study is to determine the nature of lending or the so-called 5-6 in San
Jose City.
Specific Problems:
Specifically it sought to answer the following sub problems:
1. What is the demographic profile of the respondents?
2. What is the amount that can be borrowed from informal money lenders?
3. What is the most common reason why do micro-entrepreneurs borrowing money from them?
4. What are the terms and conditions applied who borrowed money from the informal money
lenders?
5. What are the advantages and the disadvantages on the part of the lender?

Sociology behind Money

It is impossible to understand Webers sociology without understanding the theme of the
tragedy of culture in the sociology of George Simmel, particularly in his study of the growth of
exchange and money where he provided a model of the development of social abstraction. In an
indirect fashion, Webers view of legal abstraction can be seen as a particular application of
Simmers account of the growing abstraction of money as the symbol and effect of abstract social
relations.
For Simmel, the use of paper money is the measure of the growth of abstract, formal,
social relations which are increasingly subject to calculation, and indeed produced by
universalistic exchange relations. The history of money as a medium exchange is the history of
its divorce from any immediate, tangible value. Direct barter gave way to leather money, leather
money gave way to paper money, and paper money was replaced by the bank card. The growth
of cheques, credit notes, and bank cards represents the growing indifference of social exchange
to the particular, personal characteristics of economic agents. Confidence in money presupposes
the expansion of social relations based on impersonal trust with banking of the state. The sphere
of money is the entire sphere of social relations, or more precisely the sphere of the public,
rational domain of social interaction.
While money creates and expresses these social relations of stable exchange, it is also a
measure of human alienation. It represents tragically the separation of the content and form of
human actions. Money is in Simmers analysis the reification of the pure association between
things as expressed in their economic character. Thus, human individuality and human agency
become congealed and fixed in abstract money relations. Money as a reliable measure of value
becomes the vehicle of intellectualization, calculation, rationalization, and reification. Money
thus comes to represent instrumental reason in a direct form. In particular, money as primarily a
means of exchange becomes an end in itself in fact, the end of human actions. With the rise of
a positivist science of economic, moral values and economic activities become in principle, and
to a large measure in practice, separated. The extent of that separation must be opened to
empirical inquiry rather than outright condemnation.

Webers sociology of law can be seen as an adaptation and application of Simmels

sociology of money to the juridical arena. Law is one of the prime manifestations of the growing
rationality and intellectuality if social relations, providing a reified shell of calculated stability
for economic processes. Law, money and the market-place become measures of both alienation
and of individual freedom from the unpredictable world of primitive exchange. Money and law
measures both civilization and alienation. This social stability is therefore bought at a cost;
namely, that all substantive questions of justice have to be squeezed into the precise mechanism
of formal-rational law. The quest for legal stability is no longer merely a means to achieve
comparable legal decision making and instead becomes an end in itself.

Theoretical Framework
According to Mari Kondo, the Philippines as a developing country have a large informal
sector comprised of micro-enterprises. Many of these are severely restricted small vendors
operating in public markets, whose survival in business relies heavily on access to financing.
This usually comes from the informal sector is called 5-6. because of the manner in which they
lend, which charge a nominal interest rate of 20% over an agreed period of time. A person who
borrows 5 pesos from a 5-6over a period of one week repays 6 pesos, including 1 peso interest.
There are two types of 5-6 financiers found in Philippine public market they are Filipino and
Indians (Bombay) 5-6 money lenders that require collateral or documents from their
borrowers. The success of the borrowers business and loan repayment history provide a gauge
of the borrowers credibility. Five-Six money lenders undertake daily collections of payment in
the morning, afternoon or both. A clients daily payment is determined by the sum of the
principal borrowed plus its 20% nominal interest divided by the credit term. The loan
arrangement is flexible; if the clients fails to pay one day, it is understood that he or she will pay
for the day missed the next time around. The theory of Mari Kondo will guide and lead in
answering the formulated problems that they encounter and to know the strength, weakness,
opportunity and threats in the research which is all about the micro-entrepreneurs and informal
money lenders who provides their financial needs.

Private lenders over banks

There are a lot of small businessmen who are opting for private lenders over reputable
banks because private lenders do not ask for legal documentssmall time entrepreneurs dont
want the hassles of filling out applications, only to find out they are not eligible to have a bank
loan. Various documents requisites serve as stumbling blocks for our less educated kababayans
not to borrow money from lending institutions and rather approach the most approachable but
strict looking, savior-of-the-day, Bombay. Their scents have become a palatable delight in the
borrowers sense of smell. Oh, let me rephrase my statement, its the Bombay who will approach
you, for your convenience, and will give an irresistible offer: Utang ka? Bente lang, arawan
hulog. (Want to borrow money? Daily installment is 20 pesos only).

Significance

To the Social Science students: This may help to understand the sociology behind lending
business

To the Business students: This will give information that can serve as their source of
information on the strength and weaknesses and in developing the strategy about money
lending

To the Money borrowers: This will help them look into possible situations that may guide
them in deciding whenever they borrow money

To Political Science students: To know some laws behind lending money

Advantages of money lenders

They usually provide short-term finance of small loans - which is ideally suited to lowincome groups, who cannot digest' larger loans, and do not prefer long-term
commitments.

They provide loans to borrowers expeditiously and in a flexible manner, thus making
finance available immediately, when it is needed and with a minimum amount of paperwork and official requirements.

They function in close physical proximity to the borrower, enabling frequent contact and
thus dispensing the need for collateral requirements.

They do not have fixed business hours, and therefore provide loans as and when requests
are made.

Disadvantages of money lenders

They are unorganized and do not have any contact with other sections of the banking
industry

They combine money lending with trading and commission activities and thus introduce
risk into their business.

They do not distinguish between short-term and long-term finance and also in the
purpose of the loans.

They follow traditional methods of keeping accounts and do not give receipts in most
cases.

They charge high rates of interest in proportion to banking institutions.

Relationship with Banks

Money lenders play a useful role in providing credit loans to sectors not supported by
commercial banks.

Money lenders may borrow from commercial banks during high demand for credit, by
using bills of exchange or their own funds as security.

Key Implications of Money Lenders

Credit provided by money lenders is timely - that is, it is available immediately when

it is most needed - need for quick/timely credit.

They do not maintain regular business hours, and usually work throughout the day -

thus making themselves available to borrowers at any time - flexible business hours.
They live or work close to the residences and work places of their borrowers, and are
hence easily accessible - close physical/psychological proximity.

The down side of lending

It is very clear in The Law of the Philippines:
Section 2. No person shall be imprisoned for debt or non-payment of a poll tax.
Because of this prevailing law, many lenders dont have security over the money they lent. In
fact, the lender himself might be the one to go to jail by committing Light Coercion that is stated
in the Revised Penal Code. Art. 287. The only way a lender can legally claim something from a
delinquent borrower is if he has a Court Order that is called Writ of Execution. But this is a
tedious process, and sometimes to the disadvantage of the complaining party.
What a lender can do to avoid this kind of scenario is to get collaterals from the borrower as a
security for his/her money. Sometimes agreement between the lender and the borrower are put
down in paper for legal purposes. There are now small court claims which a lender can file
against the offending party and documents or proof are highly needed.
Article 287 of the Revised Penal Code reads:

Art. 287. Light coercions. Any person, who by means of violence, shall seize anything
belonging to his debtor for the purpose of applying the same to the payment of the debt, shall
suffer the penalty of arresto mayor in its minimum period and a fine equivalent to the value of
the thing, but in no case less than 75 pesos.
Any other coercions or unjust vexations shall be punished by arresto menor or a fine ranging
from 5 to 200 pesos, or both.
The second paragraph of the Article is broad enough to include any human conduct which,
although not productive of some physical or material harm, could unjustifiably annoy or vex an
innocent person. Compulsion or restraint need not be alleged in the Information, for the crime of
unjust vexation may exist without compulsion or restraint. However, in unjust vexation, being a
felony by dolo, malice is an inherent element of the crime. Good faith is a good defense to a
charge for unjust vexation because good faith negates malice. The paramount question to be
considered is whether the offenders act caused annoyance, irritation, torment, distress or
disturbance to the mind of the person to whom it is directed. The main purpose of the law
penalizing coercion and unjust vexation is precisely to enforce the principle that no person may
take the law into his hands and that our government is one of law, not of men. It is unlawful for
any person to take into his own hands the administration of justice.

Conclusion
Based on the accumulated and interpreted data given by the respondents using the
questionnaires on the above mentioned study, the researcher found out that money lending
business is not a good source of capital in starting and on supporting the day to day activities of
the business. Through data that have given by selected respondents, the most reasons why do
micro-entrepreneurs and other businesses are borrowing money from informal money lenders
or5-6 is that they have no other choice in borrowing money. It is easy to borrow money from
informal money lenders. In terms of interest rate, informal money lenders are having higher
interest rate compared to the banks and other formal institutions. The researcher also found out
that it is easy to borrow money from informal money lenders even if proper agreement.
Recommendations
When starting-up a business, micro-entrepreneurs should avoid borrowing from informal money
lending business. Based on the study, chances of not being able to roll- over the cash for working
capital are very high because interests paid to informal money lenders eats up most of the
proceeds of the business. Still the best way to start a business is to use ones own capital.
Because you will not be paying high interest in loan from the revenue generated by your business
and you will be having the chance of big income of profit. Money lending business plays an
important role in the Philippine economy because being the one who infuses capital to microentrepreneurs; it helps the country in reducing unemployment rate. Using the borrowed money
from 5-6 as an alternative source of capital, the less fortunate or below poverty line family
may start their own small scale business in public market areas. It is recommended that the
government should initiate regulatory measures on these financing businesses as well as
strengthen the banking system offering more lenient, and easier financing scheme to
entrepreneurs.

CHAPTER II
Related Studies and Literature
This Chapter presents the current study into the context of previous related research. It deals with
the Related Literature and Studies which are great help to the researcher in carrying out the
study.
* As a developing country, the Philippines have a large informal sector comprised of
micro-enterprises. Many of these are severely restricted small vendors operating in public
markets, whose survival in business relies heavily on access to financing. This usually comes
from the informal sector is called 5-6. because of the manner in which they lend, which
charge a nominal interest rate of 20% over an agreed period of time. A person who borrows
5pesos from a 5-6over a period of one week repays 6 pesos, including 1 peso interest. There
are two types of 5-6 financiers found in Philippine public market they are Filipino and Indians
(Bombay) 5-6 money lenders that require collateral or documents from their borrowers. The
success of the borrowers business and loan repayment history provide a gauge of the borrower
credibility. Five-Six money lenders undertake daily collections of payment in the morning,
afternoon or both. A clients daily payment is determined by the sum of the principal borrowed
plus its 20% nominal interest divided by the credit term. The loan arrangement is flexible; if the
clients fails to pay one day, it is understood that he or she will pay for the day missed the next
time around.*(Mari Kondo)
________________________________
*The effectiveness of informal money lenders to the micro-entrepreneurs determined if they rely heavily in
borrowing money. But accurate result must show in order to approve this.

Although the business of micro-enterprises in the Philippines varies, this study focuses on
vendors and the informal financiers catering to them in the public markets. The following types
of vendor are states below:

Ambulant vendors it is the poorest vendor in the public market; they sell smoked fish,
vegetables, fish balls, etc. They unable to buy or rent the stall, they market their food

along the sidewalks.

Rolling store vendors they sell foods, dresses, or shoes in a customized vehicle,
eliminating the need to rent a stall. They occupy spaces at the back of public market

together with the other vendors.

Stall vendors are required to be residents of the place where the market is and pay P15,
000 per stall annually. If the vendors are not genuine residents, they will pay P 20, 000
annually to the stall owner.

** Wulan stated in his study that informal money lending, informal credit in supply of formal
credit in developing countries. Despite an increase in supply of formal credit in rural areas,
informal lenders remain the dominant source of credit for the poorest households. Improvements
of productivity are important in the development process. Productive investment requires
funding and access to credit is crucial for the purpose. Credit might also be a mean tide over bad
time caused by sudden illness or an upcoming wedding for poor individuals. Previous studies of
the informal credit market demonstrate extremely high informal interest rates charged on loans to
poor individual order to make policies that can positively affect poor peoples living conditions;
we must understand how informal lenders set the interest rates.
**Norunn Haugen found in their study that village lenders in Nepal lend only to individuals
whom they know well. This indicates that village lenders know a potential borrowers risk types
and we assume that screening problems for village lenders are largely solved by personalized
relationships and interlink ages between markets. We suppose that village lenders do not face any
significant screening costs. Both village and market lenders were active in all villages we visited.
Market lenders who are not involved in local trade or village activities lack firsthand information
about potential borrowers credibility.
These lenders solve the screening problem by for example using local middlemen,
traditional screening methods or written contracts. The market lenders use of written contracts

and the village lenders criteria for providing loans indicate that there are information problems
in these credit markets. However, the village lenders are better informed about certain people and
these therefore prefer to lend to one of these. The market lenders that are not involved in any
trade or other business in a village are equally uninformed about all the potential borrowers in
the village and have to use other means to overcome the information problems like traditional
screening methods, collateral, written contracts or middlemen.
________________________________
** The informal money lenders remains dominant, whenever the borrowers need then they always there to lend
money. The study shows that we see money lenders in different places and it is an opportunity to conduct a study
that will help to the micro- entrepreneurs.
** building relationship between the informal money lenders and borrowers will gain trust and loyalty. This is one
of the factors also, why some of informal money lenders had a flexible operation.

*** Manny Canto stated on his article entitled In Depth that it is an open secret that
these Indian Nationals are doing business all over the Philippines and their business is within the
ambit of economy. According to his research Underground Economy: refers to the part of the
economy that generates income, but goes untaxed.

*** Godofredo Rompers in his Sun Star comment on taxing 5-6 lenders. He states that
money lending among those whom the banks, would never extend a loan to, and those who
believe borrowings from the banks is a lot of paper work and red tape, is a highly lucrative
business operation, able it a lot of hard work, sacrifice and patience. Interest, I think it is well
worth their sacrifice and patience. This kind of lending that is all over the rural areas is operated
only by the so- called Bombay or the Indian Nationals.
___________________________
*** Indians or the Bombays originate the informal money lending in the Philippines. They are the one who started
it and some of the Filipino impersonated it. That is there are two type of informal money lenders exist in this
country.

*** One of the reasons why most of the micro-entrepreneurs preferred to borrow money from informal money
lenders is a lot paper works. It takes time to entrepreneurs who want a started capital of less 10, 000 for his/her
business. Some of them are belong to the below poverty lines.

****The Great Greek Philosopher Aristotle has openly expressed his opposition against Money
Lending on interest.
He says: Money maybe a useful instrument of exchange but when it tempts people to pile up
unused gains or accumulate wealth by lending money, it is sterile or unproductive and it
promotes disparity in riches and financial irregularities.
**** Eugine Matura from Kigali in her write up about informal money lending stated
that this illegal money lending has high side effects because it affects property and individuals
security as well as crippling the nations economy.
__________________________________
**** Money will become useful if it will use in a productive way that will produce wealth like invest it for
the business.
**** Providing a capital for the micro-entrepreneurs is a good idea for creating a self-employed job. But
paying back the money with a high interest cant circulate the flow of the benefits. Effectiveness of this business will
be shown if they have a big impact to the economy and micro-entrepreneurs in a good way.

Legend: * - Local study

** - Foreign study

*** - Local literature

**** - Foreign literature

CHAPTER III
Research Methodology
The researcher used the most common type of qualitative research which is interview.
The respondents of this study are the private lenders of San Jose City who are Filipinos and
Indians. The target population of this study consisted of 30 selected private lenders who engage
in informal lending business. Every registered private lender had the chance to be selected on the
survey through simple random selection. The sampling technique or procedure used by the
researcher is simple random sampling. This was used to select number of individuals to be part
of the sample size wherein the researcher selected those individuals or respondents who are
engage in lending money, especially the so-called 5-6. The researcher made some questions
and conducts an interview for gather information for this study. The researcher used the arbitrary
scale to prove a verbal interpretation to the scores being calculated:
5-4.51 Strongly Agree
4.50-3.51 Agree
3.50-2.51 Disagree
2.50-1.51 Strongly Disagree
1.50-.50 Not Applicable

CHAPTER IV
Interpretation and Analysis of Data
Table 1. Sex of the Private Lender
Sex
Respondents
Percentage
Male
10
33.33%
Female
20
66.67%
Total
30
100%
The table shows that there are more female lenders (66.67%) than the male lenders
(33.33%).

Table 2. Nationality of the private lender

Nationality
Respondents
Percentage
Filipino
21
70%
Indian/Pakistani
9
30%
Total
30
100%
The table shows that there are more Filipinos who engage in private lending than Indians.

Table 3. Reasons of borrowing

Category

Weighted Mean

Result

1. Capital for the business

3.07

Disagree

2. Everyday expense of the

2.73

Disagree

business

3. Lack of Knowledge about

2.23

Strongly Disagree

the Bank Loan

4. No enough collateral to loan

2.77

Disagree

from a bank
5. Simple procedure of

2.81

Disagree

borrowing
6. Simple negotiation with the

2.42

Strongly Disagree

leaders
7. Daily Allowance for family

3.0

Disagree

expenses
Total

2.72

Disagree

This table shows the reason of the micro-entrepreneurs in borrowing money from an
informal money lender. The capital for the business as reason show 3.07 in weighted mean which
means they are disagree. 2.73 is also disagree as everyday expenses of the business, lack of
knowledge about the bank loan agreement as reason is strongly disagree that has a weighted
mean of 2.23, the reason of no enough collateral to loan from bank has a weighted mean of
2.77is disagree, simple procedure of borrowing has weighted mean of 2.81 is strongly disagree
and reason as daily allowance for family expenses is also disagree. Most of the respondents are
disagree in the stated reasons above in terms of borrowing money. It means that there is also
some collateral and procedures in borrowing money from an informal money lender. It seems
that they have enough knowledge and the ability to loan from bank but they preferred to borrow
money from informal money.

Table 4. Terms and Conditions

Category
1. The moneylender must

Weighted Mean
2.42

Result
Strongly disagree

money borrower
2. In the agreement, the

2.5

Strongly disagree

amount must be stated

3. In the agreement, the

2.31

Strongly disagree

interest rate must be declared

4. In the agreement, the mode

2.12

Strongly disagree

monthly) is indicated.
5. In the agreement, the due

2.46

Strongly disagree

date must be specified.

6. The borrower must present

3.15

Disagree

collateral to the lender.

Total

2.49

Disagree

present an agreement with the

of payment (e.g. daily, weekly,

This table presents the terms and condition of money lending procedure. Most of the
respondents are strongly disagree about the stated terms and procedures on the agreements,
because they dont want the moneylender present an agreement to them, they dont want the
amount that they want to borrow must be stated on the agreement, declared the interest rate,
indicates the mode of payment, they disagree that the borrower must present collateral to the
lenders, and specified the due date because they will pay them on the right time on what they had
been transacted.