SEC Shuts Down New Online Loan Apps As Usurers Shame Filipinos

“We have seen the emergence of fintech companies that engage in predatory lending, taking advantage of those that have financial difficulties during the pandemic,” said SEC Chairman Emilio Aquino.

The Securities and Exchange Commission (SEC) has placed a moratorium on the registration of new online lending platforms, some of which engage in abusive and predatory practices.

The SEC said it had stopped accepting requests from lending platforms as it developed new guidelines to protect borrowers and close loopholes.

Some online loan apps put borrowers to shame who cannot pay on time by texting and calling friends and relatives.

The National Commission for the Protection of Privacy had previously accused executives of online lending applications of extracting sensitive information such as contacts from the phone book on borrowers’ smartphones.

“We have seen the emergence of fintech companies that engage in predatory lending, taking advantage of those in financial difficulty during the pandemic. The Commission will work to eradicate these abusive finance and loan companies which only further indebted borrowers, ”said SEC Chairman Emilio Aquino.

Online lending platforms that were registered by the SEC before the moratorium may continue to operate, but will be subject to existing strict monitoring and auditing to ensure compliance.

To date, the SEC has canceled the licenses of 35 loan companies due to various regulations, while 2,081 companies have had their licenses revoked for failing to obtain the necessary documents.

See the list of approved loan and finance companies here. – Rappler.com


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David A. Albanese