Republic of the Philippines 
HOUSE OF REPRESENTATIVES 
Quezon City 
NINETEENTH CONGRESS 
Second Regular Session 
HOUSE BILL NO. _______ 
Introduced by HON. GUS S. TAMBUNTING 
EXPLANATORY NOTE 
This bill proposed to establish a comprehensive financial consumer protection regime wherein 
financial inclusion, financial education, good governance, and effective supervision all come into 
play given that consumer protection is a shared responsibility among the regulators, consumers 
and other stakeholders. 
Consumer confidence and trust in the financial system promotes stability, growth, efficiency, and 
innovation. However, with the rapid development of complex financial products coupled with the 
use of advanced technologies, consumer fraud, abuse and misconduct have increased. Time and 
again, we hear stories of consumers putting their lifelong savings in investment scams or suffering 
from or facing collection cases due to over indebtedness. These are just some of the travails 
experienced by financial consumers. 
Thus, recognizing the role of regulators in ensuring that the rights of every consumer are 
protected, this bill provides, among others, financial regulators such as the Bangko Sentral ng 
Pilipinas, Insurance Commission and the Securities and Exchange Commission, rulemaking, 
surveillance and inspection, market monitoring, enforcement and adjudication powers relative to 
consumer protection.  
On behalf of the people of Parañaque City’s Second District, and for the common good of the 
Filipino people, the approval of the said measure is earnestly sought. 
REP. GUS S. TAMBUNTING 
2nd District, Parañaque City 
September 19, 2023
11:16 am
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Republic of the Philippines 
HOUSE OF REPRESENTATIVES 
Quezon City 
NINETEENTH CONGRESS 
Second Regular Session 
HOUSE BILL NO. _______ 
Introduced by HON. GUS S. TAMBUNTING 
AN ACT 
AFFORDING MORE PROTECTION TO CONSUMERS OF FINANCIAL PRODUCTS AND 
SERVICES 
Be it enacted by the Senate and the House of Representatives of the Philippines in Congress 
assembled:  
SECTION 1. Short Title. – This Act shall be known as the “Financial Products and Services 
Consumer Protection Act”. 
SEC. 2. Declaration of Policy. – It is the policy of the State to ensure that appropriate 
mechanisms are in place to protect the interest of consumers of financial products and services 
under conditions of transparency, fair and sound market conduct, and fair, reasonable, and 
effective handling of financial consumer disputes. When aligned with international best practices, 
these mechanisms reinforce confidence in the financial market and foster the stability of the 
Philippine financial system. Towards this end, the State shall implement measures to protect the 
following rights of financial consumers: 
a) Right to equitable and fair treatment;
b) Right to disclosure and transparency of Financial Products and Services;
c) Right to protection of consumer assets against fraud and misuse;
d) Right to data privacy and protection; and
e) Right to timely handling and redress of complaints.
SEC. 3. Definition of Terms. – As used in this Act: 
a) Financial consumer refers to a person or entity, or their duly-appointed representative,
who is a purchaser, lessee, recipient, or prospective purchaser, lessor or recipient of
Financial Products or Services. It shall also refer to any person, natural or juridical, who
had or has current or prospective financial transaction with a Financial Service Provider
pertaining to Financial Products or Services;
b) Financial consumer complaint refers to an expression of dissatisfaction submitted by a
financial consumer against a financial service provider relative to a financial product or
service on which a response or resolution is expected;
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c) Financial product or service refers to financial products or services which are developed 
or marketed by a financial service provider which may include savings, credit, insurance, 
pre-need and health maintenance organization (HMO) products, investments, payments, 
remittances and other similar products and services. This also includes digital financial 
products and services which pertain to the broad range of financial services accessed and 
delivered through digital channels; 
d) Financial regulators refer to the Bangko Sentral ng Pilipinas (BSP), Securities and 
Exchange Commission (SEC), Insurance Commission (IC), and the Cooperative 
Development Authority (CDA); 
e) Financial service provider refers to a person, natural or juridical, which provides financial 
products or services that are under the jurisdiction of financial regulators as defined in 
this Act. This term shall include investment advisers as defined under Section 7 of this 
Act; 
f) Investment fraud refers to any form of deceptive solicitation of investments from the 
public. This includes Ponzi schemes and such other schemes involving the promise or offer 
of profits or returns which are sourced from the investments or contributions made by the 
investors themselves, boiling room operations, and the offering or selling of investment 
schemes to the public without a license or permit from the SEC, unless such offering or 
selling involves exempt securities or exempt transactions as provided for under existing 
laws; 
g) Market conduct refers to the manner by which a financial service provider designs and 
delivers its financial products and services and manages its relationships with its clients 
and the public; 
h) Marketing refers to the act of communicating, offering, promoting, advertising, or 
delivering of financial products and services by financial service providers; 
i) Responsible pricing refers to the pricing, terms, and conditions of financial products and/or 
services that are set in a way that is both affordable to clients and sustainable for financial 
institutions by taking into account, among others, client needs and the pricing schemes 
of competitors. 
SEC. 4. Scope and Coverage. – This Act applies to all financial products and services offered 
or marketed by any financial service provider. 
 
SEC. 5. Financial Regulators. – The BSP, SEC, and IC shall enforce the provisions of this Act 
on all financial service providers under their jurisdiction by virtue of their respective charters, 
special laws and amendments thereto. The CDA shall be considered an implementing government 
agency of this Act only with respect to cooperatives offering financial products and services, such 
as savings and credit, except insurance cooperatives which shall be under the jurisdiction of the 
IC for purposes of this Act. 
 
SEC. 6. Powers of the Financial Regulators. – Financial regulators under this Act shall have 
the following powers: 
 
a) Rule-making – Financial regulators shall have the authority to formulate their own 
standard and rules for the application of the provisions of this Act to the specific financial 
products or services within their jurisdiction guided by internationally accepted standards 


and practices. Financial regulators may also determine reasonableness of interest, charges 
or fees which a financial service provider may demand, collect, or receive for any service 
or product offered to consumer. Likewise, they may issue their respective rules of 
procedure concerning administrative actions arising from the implementation of this Act. 
 
b) Market Conduct Surveillance and Examination – Financial regulators may conduct 
surveillance and examination, on-site or off-site, on their respective supervised financial 
service providers, consistent with their respective risk- based supervision policies, to 
ascertain that the provisions of this Act are complied with. The examination for financial 
consumer protection compliance may be conducted separately from examination of 
prudential regulations compliance. The provisions on the conduct of examination and 
surveillance provided in the respective charters of financial regulators, and pertinent 
special laws shall be made applicable in examination and surveillance activities authorized 
under this Act. 
 
The department heads and the examiners of the financial regulators shall be authorized 
to administer oaths to any director, officer, or employee of the supervised financial service 
providers subject to the examination of their market conduct and compliance with this 
Act, and to compel the presentation of all books, documents, papers, or records in any 
form necessary in their judgment to ascertain compliance of financial service providers to 
this Act.  
 
The supervised financial service provider shall afford to its financial regulator full 
opportunity to examine its records, and review its systems and procedures at any time 
during business hours when requested to do so by the financial regulator. 
 
c) Market Monitoring – Financial regulators shall have the authority to require their respective 
supervised financial service providers and their third-party agents or service providers to 
submit reports or documents, as needed. 
 
For purposes of market monitoring, the financial regulators may obtain relevant data 
about financial products, services and markets from other government agencies, which 
shall be duty-bound to furnish the same. 
 
d) Enforcement – Financial regulators shall have the authority to impose enforcement actions 
on their respective supervised financial service providers for non-compliance with this Act 
and other existing laws pertinent to the jurisdiction and authority of the respective 
financial regulators. Such enforcement actions may include the following: 
 
1. Restriction on the ability of the supervised financial service provider to continue to 
collect excessive or unreasonable interests, fees or charges including all other 
interests, fees and charges covered under Republic Act No. 10870, otherwise 
known as the "Philippine Credit Card Industry Regulation Law"; 
 


2. Disqualification and/or suspension of directors, trustees, officers, or employees of 
the supervised financial service provider responsible for violations of the provisions 
of this Act, its implementing regulations, or orders of the financial regulators; 
 
3. Imposition of fines, suspension, or penalties for any non-compliance with or breach 
of this Act, its implementing rules and regulations (IRR), or the orders of the 
financial regulators; 
4. Issuance of a cease and desist order to the financial service provider without the 
necessity of a prior hearing if in the financial service regulator's judgment, the act 
or practice, unless restrained, amounts to fraud or a violation of the provisions of 
this Act, or may unjustly cause grave or irreparable injury or prejudice to financial 
consumers. The financial service provider shall be afforded an opportunity to 
defend its act or practice in a summary hearing before the financial regulator or 
its designated body, upon request made by the financial service provider within 
five (5) calendar days from its receipt of the order. If no such hearing is requested 
within the said period, the order shall be final. If a hearing is requested by the 
financial service provider, the proceedings shall be conducted summarily without 
adhering to the technical rules of evidence, and all issues shall be determined 
primarily on the basis of records, after which the financial regulator may either 
reconsider or finalize and execute its order; 
 
5. Suspension of the operation of any supervised financial service provider in relation 
to a particular financial product or service when in the financial regulator's 
judgment based on findings, the financial service provider is operating in violation 
of the provisions of this Act and its implementing rules and regulations. 
 
6. In any proceeding in which the financial regulators may impose a penalty for non-
compliance with or breach of this Act and other existing laws under their 
jurisdiction, the financial regulators, in addition to the imposed fine, may enter an 
order requiring accounting and disgorgement of profits obtained, or losses 
avoided, as a result of a violation of this Act and other existing laws, including 
reasonable interest. The financial regulators are authorized to adopt rules, 
regulations, and orders concerning the creation and operation of a disgorgement 
fund, payments to financial consumers, rate of interest, period of accrual, and such 
other matters as deemed appropriate to implement this provision. 
 
e) Consumer Redress or Complaints Handling Mechanism – Financial regulators shall provide 
an efficient and effective consumer redress or complaints handling mechanism to address 
conflict/dissatisfaction from financial consumers arising from financial products or 
services. The financial consumer may avail of the mechanism prior to adjudication. 
 
f) Adjudication – Financial regulators shall have the authority to adjudicate all actions as 
provided under existing laws. 
 


The BSP and SEC shall have the authority to adjudicate actions arising from or in 
connection with financial transactions that are purely civil in nature, and the claim or relief 
prayed for by the financial consumer is solely for payment or reimbursement of a sum of 
money not exceeding the amount that may be prescribed by the concerned financial 
regulators. The decision of the financial regulators in the adjudication shall be final and 
executory, and may not be restrained or set aside by the court except on petition for 
certiorari on the ground of grave abuse of discretion, or lack or excess of jurisdiction of 
the financial regulators. The petition for certiorari may only be filed within ten (10) days 
from receipt by the aggrieved party of the decision: Provided, That in the case of BSP and 
SEC, the aggrieved party may file the petition with the Court of Appeals. The adjudicatory 
power shall be exercised by the Head of the concerned financial regulator or a duly 
authorized officer or body: Provided, That in the case of BSP and SEC, the decision of the 
authorized officer or body is not appealable to the Monetary Board or the Commission en 
banc, respectively. 
 
The BSP and SEC may order the payment or reimbursement of money which is subject of 
the action filed before them. In the exercise of their adjudicatory powers, they shall have 
the power to issue subpoena duces tecum and summon witnesses to appear in their 
proceedings and when appropriate, order the examination, search and seizure of all 
documents, and books of accounts of any entity or person under investigation as may be 
necessary for the proper disposition of the cases before them. Further, the BSP and SEC 
shall have the authority to punish for contempt, both directly and indirectly, in accordance 
with the pertinent provisions of and penalties prescribed by the Rules of Court. 
 
g) Other Powers – Financial regulators may exercise such other powers as may be provided 
by their enabling laws or charters as well as those which may be implied from, or which 
are necessary or incidental to the carrying out of the express powers granted to the 
financial regulators to achieve the objectives and purposes of these laws. 
SEC. 7. Investment Adviser. – Investment advisers shall be subject to the rules and 
regulations to be issued by the SEC. 
 
The term “investment adviser'” shall mean any person who, for compensation, engages in the 
business of advising others, either directly or through publications or writings, as to the value of 
investment products or as to the advisability of investing in, purchasing, or selling investment 
products, or who, for compensation and as part of a regular business, issues or promulgates 
analyses or reports concerning investment products; but does not include the following: 
 
a) Trust Department/Unit of Banks; 
b) Stand-alone Trust Entities; 
c) A lawyer, accountant, engineer, or teacher whose performance of such services is solely 
incidental to the practice of the profession; 
d) An insurance agent whose performance of such services is solely incidental to the practice 
of profession; 
e) Any investment banker or broker dealer whose performance of such services is solely 
incidental to the conduct of the business as such investment banker or broker dealer, and 
who receives no special compensation therefor; 


f) The publisher of any bona fide newspaper, news magazine, or business or financial 
publication of general and regular circulation; 
g) Such other persons as the SEC may designate by rules and regulations, or appropriate 
order. 
SEC. 8. Duties and Responsibilities of Financial Service Providers. – 
 
a) Board and Senior Management Oversight – The Board of Directors and the members of 
senior management of financial service providers shall ensure conformity with this Act and 
shall provide the means by which they shall identify, measure, monitor, control, and 
manage consumer protection risks inherent in their operations, in accordance with their 
respective rules and regulations of their financial regulators. 
 
b) Appropriate product design and delivery – Financial service providers shall continuously 
evaluate their financial products and services to ensure that they are appropriately 
targeted to the needs, understanding and capacity of both their markets and their clients. 
This shall include, among others, the following: 
 
1. Affordability and suitability assessment – Financial service providers should have 
written procedures for determining whether a particular financial product or 
service is suitable and affordable for their clients. This shall include the 
determination of whether or not the amount and terms of the offered financial 
product or service allow various clients to meet their respective obligations with a 
low probability of serious hardship, and that there is a reasonable prospect that 
the financial product or service will provide value to its client. For the purpose of 
extending credit, this assessment will include measures to prevent over-
indebtedness. 
2. Cooling-off period – Financial service providers are expected to adopt a clear 
cooling-off policy as may be prescribed by law or by rules and regulations issued 
by the relevant financial regulator upon its determination that a cooling-off period 
is necessary for a product that is subject to its regulation. Such policy should, 
among others, provide a cooling-off period that will allow a client to consider the 
costs and risks of a financial product or service, free from the pressure of the sales 
team of the financial service provider. The length of the cooling-off period should 
be individually determined by financial service providers based on reasonable 
expectation of the time required for a client to fully evaluate all the terms and risks 
of the financial products or service and contact concerned parties who may be 
affected by its terms and conditions, unless a minimum or fixed period is prescribed 
by the financial regulator for the compliance of a financial service provider or when 
stipulated in the terms of the offer for such a financial product or service. Financial 
regulators may opt not to provide for a cooling-off period for short term 
transactions or contracts.  
 
During the cooling-off period, the financial consumer may cancel or return the 
contract without penalty; however, nothing herein shall prevent financial service 
providers from recovering the processing costs incurred, as may be approved by 


the financial regulators. Financial service providers are prohibited from engaging 
in practices that unreasonably burden the financial consumer in the exercise of the 
right of cancellation during the cooling-off period. If the financial product is a 
contract of insurance, a pre-need or a health maintenance organization (HMO) 
product, the right of return cannot be exercised after the financial consumer has 
made a claim. 
 
3. Pre-payment of loans and other credit accommodations – A borrower may, at any 
time prior to the agreed maturity date, prepay a loan or other credit transactions 
in whole or in part: Provided, That costs or fees charged to the borrower for such 
pre-payment, if any, shall be disclosed to ensure transparency, disclosure, and 
responsible pricing as required under this Section. 
 
c) Transparency, disclosure, and responsible pricing – Financial service providers must 
ensure that they adopt disclosure principles in their communications and their contracts 
with financial consumers, including the use of clear and concise language, to ensure that 
all information concerning the financial service is understood by target clients. This shall 
also include updated and accurate disclosure of information, such as on pricing or any 
cost associated with the product or service, and should be made in a consistent manner 
to facilitate a comparison between similar financial products and services across the 
industry. 
 
Sufficient product disclosure must be provided before the contracting of the product or 
service to give the client enough basis and time for review. Any change in the terms or 
conditions of a product or service shall be provided to the client. 
 
In their advertising materials, financial service providers shall disclose the contact 
information of their consumer assistance unit providing consumer assistance and handling 
financial consumer complaints. Financial service providers shall also disclose that they are 
regulated and the advertising materials must identify the relevant financial regulator.  
Financial service providers are legally responsible for all statements made in the marketing 
and sales materials that they produce relative to their products or services. Disclosure of 
information on financial products or services shall be made available to the public by the 
financial service provider through printed materials, mass media, websites or digital 
platforms.  
 
Financial service providers must have internal policies and procedures on setting prices 
for their products and services that take into consideration, among others, the principle 
of responsible pricing. 
 
d) Fair and respectful treatment of clients – Financial service providers shall have the right 
to select their clients: Provided, That they shall not discriminate against clients on the 
basis of race, age, financial capacity, ethnicity, origin, gender, disability, health condition, 
sexual orientation, religious affiliation, or political affiliation: Provided, further, That 
financial service providers may provide distinction, as necessary, when making a risk 
assessment on a specific financial product or service. 
 


Financial service providers are prohibited from employing abusive collection or debt 
recovery practices against their financial consumers. 
 
e) Privacy and protection of client data – Each financial service provider must respect the 
privacy and protect the data of their clients. Consistent with the provisions of Republic Act 
No. 10173, otherwise known as the Data Privacy Act, the financial regulators shall issue 
regulations in coordination with the National Privacy Commission, governing the disclosure 
of client data to a third party. 
 
Clients shall have the right to review their data to ensure that inaccurate or deficient data 
is corrected or amended. 
 
f) Financial consumer protection assistance mechanism – Each financial service provider 
must establish a single consumer assistance mechanism for free assistance to financial 
consumers on financial transactions concerns. This shall include handling of complaints, 
inquiries and requests. 
 
Financial consumers who are unsatisfied with the financial service provider's handling of 
their complaints, inquiries and requests, may elevate their concerns to the financial 
regulator which has jurisdiction over the financial service provider concerned. 
 
SEC. 9. Bundling of Products. – When a financial consumer is obliged by the financial service 
provider to purchase any product, including an insurance policy, as a pre-condition for availing a 
financial product or service, the financial consumer shall have the option to choose the provider 
of such product subject to reasonable standards set by the financial service provider, and this 
information shall be made available to the financial consumer.  
 
SEC. 10. Training. – Staff members of financial service providers who deal directly with financial 
consumers, including those who are involved in financial consumer protection assistance 
mechanism, must receive adequate training suitable to the complexity of the financial products 
or services they offer. Financial service providers must be qualified as appropriate for the 
complexity of the financial product or service they offer. 
 
SEC. 11. Investment Fraud. – It shall be unlawful for any person or persons to commit 
investment fraud as defined in this Act.  
 
SEC. 12. No waiver of rights. – No provision of a contract for a financial product or service 
shall be lawful or enforceable if such provision waives or otherwise deprives a client of a legal 
right to sue the financial service provider, receive information, have their complaints addressed 
and resolved, have their non-public client data protected, or cancel the use of the financial product 
or service without an unreasonable penalty. 
 
SEC. 13. Liability of a Financial Service Provider For Acts or Omissions of Its 
Authorized Representatives. – The financial service provider shall be responsible for the acts 
or omissions of its directors, trustees, officers, employees, or agents, in marketing and transacting 
with financial consumers for its financial products and services. 
 


SEC. 14. Prescription. – All actions or claims accruing under the provisions of this Act, and the 
rules and regulations issued pursuant thereto, shall prescribe after five (5) years from the time 
the financial consumer transaction was consummated, or after five (5) years from the discovery 
of deceit or non-disclosure of material facts: Provided, That such actions shall, in any event, 
prescribe after ten (10) years from the commission of the violation: Provided, further, That for 
insurance contracts, the prescriptive period for the commencement of action provided under the 
Insurance Code shall apply. 
 
SEC. 15. Penalties. – Any person who willfully violates any provision of this Act or any related 
rules, regulations, orders, or instructions issued by financial regulators, sh311 be punished by 
imprisonment of not less than one (1) year, but not more than five (5) years, or by a fine of not 
less than Fifty thousand pesos (P50,000.00) but not more than Two million pesos 
(P2,000,000.00), or both at the discretion of the court: Provided, That if the violation is committed 
by a corporation or a juridical entity, the directors, officers, employees, or other officers who are 
directly responsible for such violation shall be held liable thereto.  
 
SEC. 16. Administrative Sanctions. – The administrative sanctions of the respective charters 
of the financial regulators shall be made applicable to financial service provider, its directors, 
trustees, officers, employees or agents without prejudice to the enforcement actions prescribed 
under Section 6(D) of this Act for willful violation of this Act or any related rules, regulations, 
orders or instructions of financial regulators: Provided, That in case profit is gained or loss is 
avoided as a result of the violation, a fine not more than three (3) times the profit gained or loss 
avoided may also be imposed by the Financial Regulator: Provided, further, That in addition to 
the administrative sanctions that may be imposed, the authority of the Financial Service Provider 
to operate in relation to a particular Financial Product or Service may be suspended or cancelled 
by the Financial Regulator. 
 
SEC. 17. Independent Civil Action. – A financial regulator, consistent with public interest and 
the protection of financial consumers, is authorized to institute an independent civil action on 
behalf of aggrieved financial consumers for violations of this Act and its implementing rules and 
regulations.  
 
If in any of these proceedings, the financial regulators obtain a civil penalty against any person 
or entity, or such person or entity agrees to settle such civil penalty, the amount of the penalty 
shall, upon the motion of the financial regulators, be added to and become part of a disgorgement 
fund or another fund established for the benefit of the aggrieved financial consumer.  
 
SEC. 18. Transitory provision. – The financial regulators shall prepare the necessary rules and 
regulations to implement the provisions of this Act within one (1) year from its effectivity. 
 
SEC. 19. Separability Clause. – If any provision of this Act is held unconstitutional or invalid, 
all other provisions not affected thereby shall remain valid.  
 
Sec. 20. Repealing Clause. – All laws, executive orders, rules and regulations or parts thereof 
which are inconsistent with this Act are hereby repealed or amended accordingly. Articles 131 to 
147 of Title IV of Republic Act No. 7394 are hereby repealed. 
 


SEC. 20. Effectivity Clause. – This Act shall take effect fifteen (15) days after its publication in 
the Official Gazette or in a national newspaper of general circulation. 
 
Approved.