MANILA -- Money is tight these days and many have been scraping the bottom of their savings barrel for several weeks now. Not much of a surprise when in just a couple of months, unemployment has reached 7.3 million due to business closures and workforce reductions because of the enforced community quarantine. Add to that some 354,000 displaced overseas Filipino workers, and we can expect to hear sob stories anywhere we turn.

Jillian Arroyo admits to experiencing the same cash woes. The difference between her and many others in the same boat? She does not need to borrow money to fix it. All she needs to do is to find the courage to collect money family and friends owe her. If she is 100% successful, she will have enough to cover her living expenses for the rest of the year.

But how to broach the subject especially now when almost everyone is having a hard time? If she doesn’t do it though, Jillian knows she will be the one doing the borrowing soon. Sleepless nights are taking a toll on her physical and mental health so Jillian knows she has to act, and soon.

Yes, it’s going to be one awkward conversation. Maybe even several awkward conversations, but it is your hard-earned money and a loan is a loan. Here are some strategies that could work.

#1 Go straight to the point.

Most lenders never get their money back for this simple reason: they do not collect. If you are waiting for your relative or friend to pay you back, chances are you will never see your money again. So make that call, speak honestly, and ask for your money back. List dates and amounts if we are talking of more than one loan.

#2 Be ready with the evidence.

Ideally, you have some written document that can prove he or she borrowed money from you, how much, and on what date. But when helping out family and friends, most would not demand such a thing so what they can show is probably a text message or a copy of a check the borrower cashed. But any proof is better than none.

#3 Prepare for a face-off.

Admit it – one of the reasons you hesitate to collect is you worry about the reaction you will get. So prepare yourself for a face-off. Some borrowers get hurt or angry or even deny that they still owe you. There are others that even argue that they did not think it was a loan but a gift from you! Do not be surprised if the person you are talking to gets ‘loan amnesia’. Keep calm and focus on the prize, which is you getting your money back.

#4 Set a date – and tell them you need the money too.

It’s unlikely you will be paid on the same day you called them, but do not end the conversation without getting a commitment on when you can collect. Considering the times, suggest payment terms but the shorter the better. While you want to be helpful, do not be too helpful that you end up back where you started – which is a lender with no loans paid back.

#5 What if they have no cash to pay you back?

One of the people that owed Jillian offered to pay her back with a laptop. It was slightly used and she did not know what to do with it so she said no. Now she regrets not having taken it and maybe selling it or finding a use for it when the borrower clearly has no means to pay her. Be ready to barter and haggle with your borrowers. If they are cash strapped too but can give you a TV, a smart phone, a designer bag, do not say no right away. If cash is not an option, I suggest take what you can get.

#6 Suggest a debt swap if possible.

Jillian does not owe anyone any money yet, but it can happen soon if she does not act on her debt collection plan. If one of her borrowers has no cash, but has family or friend with means, how about a debt swap? Jillian can “borrow” from her debtor’s relative and the agreement will be that the debtor will be the one to pay that back. This is trickier and the debtor and the relative may say no, but worth a try just in case.

#7 Soured relations? Consider outside reinforcements.

There is something worse than ‘loan amnesia’ and that’s ‘loan tantrum’. Some borrowers have a violent reaction to their lenders trying to collect from them. You don’t deserve that behavior so bring in outside reinforcements. How about calling him with another friend or relative? Having one more person may stop him from losing his temper and contain his aggressive behavior. And while we are on this subject, this is why you have to be very, very careful when you lend money, and who you lend it to.

#8 Is it time to call a lawyer? Start with the barangay captain instead.

When all your efforts fail, is it time to bring in a lawyer? The sad truth is that for small amounts, it can be a huge inconvenience to involve a lawyer (whom you will need to pay too) and file a lawsuit (which will also cost you). For small claims, appealing to the barangay may help you more. If you and the borrower live in the same neighborhood, the barangay can summon you both and mediate. Sometimes, just the idea that they have to face the barangay regarding a loan can spur the borrower into payment.

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These are not borrower-proof strategies. Some may work, or none may work. You may have to be ready to write the loan off, especially if the loans are many years old and your relative or friend has fallen into hard times. But make sure to tell them too. If you decide to ‘gift’ the loan to them, only do so after attempting to collect and realizing you will not be able to squeeze blood out of this particular stone. This way you put the issue to rest, and hopefully save the relationship and prevent them from borrowing from you again.