SEC suspends registration of new online lending platforms
November 5, 2021 | 4:23 p.m.
MANILA, Philippines – The Securities and Exchange Commission has shut down online lending platforms by suspending new listings in an attempt to end predatory behavior by these finance companies.
In a statement released Friday, the regulator issued the moratorium as it watched fintech companies take advantage of financially needy Filipinos amid the pandemic that has plunged the Philippine economy.
“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 root out those abusive finance and loan companies that only bury borrowers in even more debt, ”said SEC Chairman Emilio B. Aquino.
As it stands, the SEC has said that online lending platforms registered before this rating will be allowed to continue operating, as those businesses will be subject to strict regulatory oversight and compliance.
There are 101 loan and finance companies registered with the SEC before the suspension.
That said, the regulator issued a circular memorandum ahead of the publication of new rules governing the licensing and registration of online lending platforms of finance and lending companies.
The SEC has revoked the licenses of 35 finance and loan companies over a long list of violations.
Likewise, the SEC has ordered the closure of 58 online lending platforms due to a lack of authority to operate as a lending or financing business.
The regulator also revoked the registration certificate of 2,081 loan companies because these companies failed to obtain a certificate of authority mandated by the 2007 Loan Company Regulation Act.