SEC stops registration of new online lenders
The Securities and Exchange Commission (SEC) halted the registration of new finance and lending companies’ online lending platforms (PLOs) after it discovered loopholes in an old ruling were being used to prey on unwitting victims .
The SEC ordered a moratorium on new online lending platforms (SEC Memorandum Circular 10, Series of 2021) on November 2, ahead of the publication of new rules that will govern the licensing and registration of corporate PLOs. financing and loan.
“We are currently developing new guidelines that will allow loan and finance companies to better meet the needs of borrowers and, at the same time, close the loopholes that give rise to abusive and predatory practices,” said the president of the SEC, Emilio B. Aquino.
“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 those abusive finance and loan companies that only bury borrowers in even more debt, ”he said.
Online lenders who were registered with the SEC before the moratorium can continue to operate and be used for online loans or financing. The SEC has said it will subject existing lenders to strict monitoring, audit and review to ensure compliance with all applicable laws, rules and regulations.
To date, the SEC has canceled the licenses of 35 finance and loan companies due to various violations of its rules and regulations.
The certificate of registration of a total of 2,081 loan companies was also revoked by the SEC for failing to obtain the required certificate of authority, in accordance with Republic Law 9474 or the 2007 Law on regulation of loan companies.
Some 58 online loan applications have been ordered to cease operations for lack of authorization to operate as a loan or finance company.