MANILA, Philippine — More online lending companies may soon face government scrutiny after the Securities and Exchange Commission (SEC) on Monday said it had issued cease-and-desist orders against 19 online lending applications.
These orders, according to SEC Commissioner Kelvin Lester Lee, followed numerous complaints, including invasion of privacy and harassment.
The Sept. 12 orders cover Instant Pera, QuickPera, Lendmo Philippines, Binixo, CashBus, Cashcat, Cashuttle, Crazy Loan, Flash Cash, Happy2Peso, Hatulong, MeLoan, MoneyTree Quick Loan, Pera Express, Pera4u, Peramart, PesoLending, QuickPeso and Umbrella.
According to the SEC’s findings, the owners and operators of the online lending applications have not secured the required certificates of authority to operate as lending or financing companies. Furthermore, they are not registered with the SEC.
The apps are different from the three companies charged by the National Privacy Commission (NPC) earlier this month, since those companies — which used personal information without consent and publicly shamed borrowers with unsettled debt — were registered under the SEC.
But Lee said the problem with online lending had gone beyond violations of data privacy.
“Borrowers complained about high interest rates, unreasonable terms and conditions, misrepresentations as to noncollection of charges and fees, violation of their right to privacy, harassment and other abusive collection practices,” he said.
Lee said the SEC’s investigation showed that unauthorized lenders managed to access personal information from borrowers’ mobile phones, such as names and contact numbers.
“A number of complainants said pressure and abusive collection practices by unauthorized lenders have caused them depression, sleepless nights, humiliation and health problems.
Meanwhile, FinTechAlliance.ph said on Monday that its member companies had agreed to institutionalize an industry-wide code of ethics and adopt a code of conduct for responsible online lending.
The code of conduct prohibits member companies from using “unlawful threats, intimidation or harassment” to collect unsettled accounts. It also required fintech players to adopt “fair, professional and non-abusive collection practices.”