NPC to online loan applications: stop harassing borrowers

The National Privacy Commission (NPC) and financial institutions are calling on operators of online loan applications to refrain from harassing their borrowers through unauthorized use of their personal data.

In a joint statement Wednesday, NPC, the Philippine Finance Association, Fintech and the non-bank finance sectors condemned the excessive collection of personal data by some online lending platforms.

Some information is being collected “without a legitimate purpose,” they said, citing the customer’s contact list and photo gallery, both of which are unnecessary in determining creditworthiness.

“We also reiterate our call to operators of non-compliant online lending applications to refrain from exploiting borrowers by using borrowers’ personal data to shame them and coerce them into paying their loans through a unauthorized and unfair use of their personal data, ”they said.

The organizations said operators should act with a “strong moral code,” especially amid the challenges the pandemic poses to borrowers.

Online lending companies, they said, should adhere to the code of conduct, code of ethics, and code of collection standards and ethics created by Fintech and the Philippine Finance Association. Codes have been developed and industry standardized to protect consumers.

Additionally, the privacy watchdog has reminded loan app operators to follow the Data Protection Act 2012 and related laws when handling customers’ personal data.

“We call on these non-compliant lending entities to use legal and reasonable methods to assess the creditworthiness of loan applicants as well as in debt collection practices by defending the rights of those affected without resorting to unfair debt collection practices. and harassment of borrowers such as the use of insults or foul language, violent threats or misrepresentation and unnecessary exposure of their borrowers’ personal data to unauthorized persons, ”they added.

Last month, the NPC banned four online lending apps over their unauthorized use of personal data, resulting in harassment and shame among borrowers. These apps are JuanHand, Pesopop, CashJeep, and Lemon Loan.

NPC cracked down on operators of online loan applications, banning 26 loan applications in 2019 for failing to respond to allegations made against them, including the use of personal data to shame delinquent borrowers.

These are no longer publicly available for download, installation or use, NPC said.

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David A. Albanese

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