How To Check if You Are Blacklisted for Credit in the Philippines

 A lot of us have gone through some serious financial difficulties at various points in our lives. You may have taken a loan, struggled to keep up with monthly payments, been unable to repay, and defaulted altogether.

You are now wondering, will your tainted financial past haunt you for the rest of your life? Are you blacklisted from acquiring new credit? Is there a way out of the “blacklist”?

All is not lost for someone with a dismal financial situation. There are still ways for you to bounce back and you’d be happy to know there are still loan options available for blacklisted individuals. 

Table of Contents

What Does “Blacklisted” Mean?

Being blacklisted means that you have done something or behaved in a way that is deemed unacceptable1 and deserves punishment or deprivation of a service. In the financial industry, being blacklisted means that you have poor credit records and are unqualified to acquire credit.

When applying for a new loan or credit with a bank, they conduct a credit investigation to check your borrowing history and assess your capability to manage and pay back debts. This includes looking into your credit report and public records to verify that you have no delinquent accounts. 

Negative findings such as habitually late or non-payments, tax liens, or court cases involving money indicate a high-risk borrower and banks will likely decline your loan application. These red flags are reasons for being blacklisted.

Where Can You Find a Blacklist?

It is worth emphasizing that there is no official comprehensive blacklist in the Philippines. What is available are records related to an individual indicating one’s creditworthiness which are sourced from the credit registry, credit bureaus, and financial institutions.

Members of the following entities collect and share credit information of their clients to guide lenders in their decision to grant or extend credit to their borrowers.

1. Credit Information Corporation (CIC)

CIC is the country’s credit registry and repository of positive and negative information used by different financial institutions for credit investigation. However,  its mandate does not include the blacklisting of borrowers2

2. Credit Management Association of the Philippines (CMAP)

CMAP is a credit management institution that facilitates credit information exchange among its members from different industries. It maintains an online database of the following information:

  • Court cases in debt-related categories filed in major cities of the Philippines
  • List of clients with returned checks
  • Accounts endorsed to lawyers
  • Past due accounts from telecommunication and manufacturing companies

3. Bankers Association of the Philippines Data Exchange, Inc. (BAP-DX)

BAP-DX provides relevant credit information services for all member banks3. These local and international banks regularly update their database to allow them to make accurate and efficient credit decisions.

How Do You Know if You Are Blacklisted?

1. Check your credit report

The easiest way to see if you are blacklisted is to get a copy of your credit report from the accredited credit bureaus4 or your bank5. Details in your credit report will give you an idea of what credit information about you is being shared with financial institutions.

2. Check the members of CIC, CMAP, and BAP-DX

Since access to certain negative credit information is restricted to authorized members of these groups, you can check who are the financial companies that upload data to their database. It would be reasonable to assume that if the credit company you have a bad history with is a member, then you are already flagged as delinquent in their system and are consequently shared with the whole organization.

How Long Does Blacklisting Last?

It is important to understand that a fair and accurate credit report includes both positive and negative information. Even after paying all your debts, it is highly unlikely that the negative info will be immediately erased. It can still be retained in the CIC’s database for up to 3 years6 from the date of payment or settlement of debt through a compromise agreement or court decision.

Although it won’t go away completely, the impact of negative information on your credit score decreases over time.

What To Do After Getting Blacklisted?

Once you find yourself “blacklisted”, it is best to do the following steps:

  1. Get in touch with the lender. Communicating with the bank that you are willing to settle your debt is a way to show that you are not running away from your obligation. 
  2. Negotiate for a restructuring of your debts. You may find it surprising, but banks are usually willing to restructure your payment terms if you have shown intent to pay your debt in full. It is more costly for them to hire a third-party collection agency or pursue legal action.
  3. Pay your debts. Make it right this time and settle your debts. Keep your word as they may disagree with further reconsideration if you fail to keep your end of the bargain.
  4. Get a certificate of full payment. Once your debt is settled, request a certificate of full payment. This will come in handy for your future transactions.
  5. Notify the bank and credit bureau to update your credit information. Ask the bank nicely to update your credit information. You can also file a dispute in CIC if it is not reflected in your credit report after 30 days from payment.

Financial Aid Options for Blacklisted Individuals

Being “blacklisted” makes it difficult to apply for new lines of credit. However, there are alternative loans that do not require a credit check. This comes with the consequence of higher interest rates and shorter repayment terms.

Here are some of the bad credit or no-credit-check loans:

  • Online lenders – with the rise of the fintech industry, online lenders are becoming more popular as they can process and release loans quicker than traditional loans. Make sure you only transact with legitimate lending online platforms7.
  • Government-supported loansSSS, GSIS, and PAG-IBIG provide loan options for their members and are usually based on your monthly contribution.
  • Paycheck advance – depending on your arrangement, you can try asking your boss for an advanced salary payable on the next paycheck.
  • Pawnshop loan – you only need to provide your contact information and a valuable item as collateral to receive funds from a pawnshop.
  • Borrow money from a friend or family – this may be an easy option but it may put your relationship at risk especially if there is no signed agreement.

Tips and Warnings

  • No credit history is not a reason to be blacklisted. First-time borrowers may also find it challenging to acquire a loan as lenders do not have a basis for assessing payment behavior, but they are not treated as blacklisted.
  • Avail of the Interbank Debt Relief Program8 if you’re having trouble with your credit card payments. Inquire with your bank for the requirements and qualifications.
  • Keep an updated contact information with your credit card provider to avoid being considered as using your credit card with intent to defraud under the Access Devices Regulation Act9.
  • Be cautious in using no-credit-check loans. Approval for these loans is easier than traditional banks but it comes with higher interest rates and fees. Beware of scams that guarantee a lower interest rate in exchange of upfront fees or phishing scams that ask for your personal information which can be used for identity theft.

Frequently Asked Questions

1. If my loan or credit card application gets rejected, does it mean I am blacklisted?

Being blacklisted is not the only reason for being declined a loan. There are other factors such as stability and amount of income, sufficient collateral, and submission of complete and accurate documents.

2. If my loan application pushes through, does it guarantee that I am not blacklisted and I do not have a problem with my credit records?

Your credit report provides both positive and negative information about you. It is up to the banks to weigh these factors based on their criteria and requirements. Credit decisions are made by the lenders and not the credit bureaus.

3. Do employers check if an applicant is blacklisted by banks?

Depending on the company and position applied for, some employers do check the applicant’s credit records to verify credibility and professionalism.

References

  1. Kenton, W. (2022). Blacklist. Retrieved 24 April 2022, from https://www.investopedia.com/terms/b/blacklist.asp
  2. PRESS RELEASE: More borrowers from lending, financing companies loaded in the CIC database. (2021). Retrieved 24 April 2022, from https://www.creditinfo.gov.ph/press-release-more-borrowers-lending-financing-companies-loaded-cic-database
  3. Membership. (2021). Retrieved 24 April 2022, from https://bap.org.ph/about/membership/
  4. Get your credit report. Retrieved 23 April 2022, from https://www.creditinfo.gov.ph/get-your-credit-report
  5. PRESS RELEASE: CIC Basic Credit Reports are now available via select accessing financial institutions. (2022). Retrieved 24 April 2022, from https://www.creditinfo.gov.ph/press-release-cic-basic-credit-reports-are-now-available-select-accessing-financial-institutions
  6. About your CIC Credit Report. Retrieved 23 April 2022, from https://www.creditinfo.gov.ph/about-your-cic-credit-report
  7. List of Recorded Online Lending Platforms. (2021). Retrieved 24 April 2022, from https://www.sec.gov.ph/lending-companies-and-financing-companies-2/list-of-recorded-online-lending-platforms/
  8. Credit Card Association of the Philippines (CCAP). (2022). Interbank Debt Restructuring Program (IDRP) Explainer Video [Video]. Retrieved from https://www.facebook.com/CreditCardAssocPH/videos/467948431630084/
  9. Payments and Collections. Retrieved 24 April 2022, from https://www.ccap.net.ph/credit-card-basics/payments-and-collections/

Moanna Santos, MBA

Moanna Santos holds a Master’s degree in Business Administration (MBA) from the University of the Philippines – Diliman where she took elective courses in Risk Management, Asian Business, Consumer Behavior, and Business Ethics. She has 3 years of experience in Procurement in the Food and Beverage Industry. A first-time mom who is constantly amazed by her toddler, she hopes to inspire others by sharing her knowledge.

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