DTI starts inquiry on ‘installment only’ basis
The DTI steps in to address this consumer concern on limiting his/her options to pay, not only for motorcycles, but also for other products and services that he/she needs
Following the disclosure made by Senator Richard Gordon on the questionable scheme of some motorcycle traders who require buyers to opt for installment basis instead of paying in cash, the Department of Trade and Industry (DTI) started conducting public hearings on the draft of its guidelines for payment options on the purchase of consumer products or services.
In a recent hearing of the Senate Blue Ribbon Committee, which was attended by Trade Secretary Ramon Lopez, Gordon exposed that some traders are reportedly discouraging their clients to pay in full, instead, encouraging the buyers to choose installment offers, which carries an interest rate of about 36 percent.
In order to eliminate this practice, Trade undersecretary and Consumer Protection Group chief Ruth Castelo, in a statement, said consumers should be provided with payment options when purchasing products and services.
An act or practice shall be deemed unfair.
With the illicit practice of some traders, Castelo noted that the DTI sees the need to reiterate the applicable provisions under the Consumer Act of the Philippines and other relevant laws to ensure that consumers are adequately protected.
“The DTI steps in to address this consumer concern on limiting his/her options to pay, not only for motorcycles, but also for other products and services that he/she needs,” she said.
According to her, Article 52 of the Consumer Act clearly explains the malpractice of some traders as, “An act or practice shall be deemed unfair or unconscionable whenever the producer, manufacturer, distributor, supplier or seller, by taking advantage of the consumer’s physical or mental infirmity, ignorance, illiteracy, lack of time or the general conditions of the environment or surroundings, induces the consumers to enter into a sales or least transaction grossly inimical to the interests of the consumer or grossly one-sided in favor of the producer, manufacturer, distributor, supplier or seller.”
Castelo said that from January 2019 to January 2021, the DTI has already received 3,060 complaints coming from consumers who were persuaded on the “installment only payment” option that motorcycle dealers and shops implement.