5-6 loans
By bagumbayan
@bagumbayan (2705)
Philippines
July 15, 2008 2:55am CST
Are you familiar with the 5-6 loans. I supposed this loan lending originated in Bombay, India as it was started from people called Bombay. This is how it is, when you borrow the amount of 5 peso you will return the amount of 6 pesos in a 15 days term or on a weekly term. This is a kind of usury that because of necessity many goes into it. The lenders are often called loan shark. Are you aware of this kind of loans and do you bite it.
1 response
@amrishkj (297)
• India
15 Jul 08
Its not like that. The loan is like this
You need 1000 pesos, you go to the person who would lend you 1000 but what he will do is he will deduct 10% or 100 pesos and give you 900 pesos. Now the payback is like you have to pay him back 100 pesos for 10 pesos for 100 days. That is how the system works. And yes it is very very high interest rate that you pay. Am from India and that is why I know about this system.
@bagumbayan (2705)
• Philippines
16 Jul 08
So it really originated from your place. But the sum total of interest is about 20% the 10% when the 1000 loan 900 was given, and the 10% when the payment was made for 100 days at 10 per day because you returned the whole 1000. At any rate, what others are doing, they are lending say 1000, they pay the 20% interest every 15th or 30th of the month and the capital is still there. The difference I can see is that the payback period of your loan is at least 100 days while what is going around here is interest for a shorter term, which is more usurious. Hope I am right with my analysis in your system and thanks for the response
