5% per month null and void

Interest rate of 5% per month, which when summed up would reach 60% per annum, is null and void for being excessive, iniquitous, unconscionable and exorbitant, contrary to morals, and the law.

Contracts; contract of loan; interest stipulated; reduced for being iniquitous and unconscionable. -

Parties to a loan contract have wide latitude to stipulate on any interest rate in view of the Central Bank Circular No. 905 s. 1982 which suspended the Usury Law ceiling on interest effective January 1, 1983. It is, however, worth stressing that interest rates whenever unconscionable may still be declared illegal. There is nothing in the circular which grants lenders carte blanche authority to raise interest rates to levels which will either enslave their borrowers or lead to a hemorrhaging of their assets.In Menchavez v. Bermudez, the interest rate of 5% per month, which when summed up would reach 60% per annum, is null and void for being excessive, iniquitous, unconscionable and exorbitant, contrary to morals, and the law. 

- Florpina Benvidez v. Nestor Salvador,G.R. No. 173331, December 11, 2013.

See - http://lexoterica.wordpress.com/2014/01/15/december-2013-philippine-supreme-court-decisions-on-civil-law/