India Aims to Copy China, But Not In Lending-by-App Craze
Jai Copycat.
Bollocks, who are they kidding, its a predatory lending, you know why the locals call them Bumbay, let this study do the talking, It's a
parasite and lazy oligarchy style businesses model that the Indians are expert at.
Five-Six Moneylenders. So-called because of the manner in which they lend, five-six (5-6) moneylenders charge a
nominal interest rate of 20 percent over an agreed period of time. A person who borrows 5 pesos from a 5-6 moneylender over a period of one week repays 6 pesos, including 1 peso interest. Neither Filipino nor Indian 5-6 moneylenders require collateral or documents from their borrowers. The success of a borrower’s business and loan repayment history provide a gauge of the borrower’s credibility.
At the Santa Rosa public market, 5-6 moneylenders undertake daily collection of payments in the morning, afternoon, or both.
A client’s daily payment is determined by the sum of the principal borrowed plus its 20 percent nominal interest divided by the credit term. The loan arrangement is flexible; if the client fails to pay one day, it is understood that he or she will pay for the day missed the next time around.
Renewal of loans depends on the moneylender’s policy. Some 5-6 moneylenders will renew clients’ loans only after the previous loan is paid in full. More accommodating lenders will renew a client’s loan earlier, subtracting the outstanding balance of the old loan from the new loan and issuing the client the remainder.
Filipino and Indian 5-6 lenders play different roles among the vendors at the Santa Rosa market, although the essence of the 5-6 business is the same. The significant difference lays in the fact that Filipino 5-6s are resident “insiders” in the Santa Rosa community, while the Indians, as immigrants, are clearly identified as “outsiders.”
Two types of 5-6 financiers are found in
Philippine public markets, each with a distinctive
lending mechanism,
Filipinos and Indians.