Online lending platforms are facing tougher rules starting next month as the Securities and Exchange Commission (SEC) continues its crackdown on illegal personal loan apps.
The SEC said in a statement that Google, which runs one of the world’s largest app stores, will start requiring online lending platforms targeting users in the Philippines to prove they are duly registered with the corporate regulator on May 11.
Person loan apps will need to submit a declaration and necessary documentation before they could publish apps on Google Play Store.
Google will also impose the additional requirements in India and Indonesia, the statement showed.
The SEC said this was the result of discussions going back to May 2019 to “address the proliferation of unregistered personal loan apps.”
So far, the SEC ordered 72 illegal online lending platforms to shutter operations because they did not have the authority to operate as a lending and financing company.
“We thank Google for supporting our efforts to combat illegal and abusive lending, and thereby preserve the financing and lending industry’s integrity, and provide Filipinos secure and accessible financing options,” SEC chair Emilio Aquino said in the statement.
“We are positive that the additional requirements, imposed by Google for developers of personal loan apps targeting users in the Philippines, will serve as another layer of protection for Filipino borrowers and deterrence against predatory lending,” he added.
The SEC said the personal declaration form would require loan app developers to state they were registered with and duly licensed by the SEC Philippines to operate an online lending platform or act as a crowdfunding intermediary.
Moreover, developers must “confirm” they were engaged in a lawful business activity and in compliance with applicable laws.
Apps that fail to submit the declaration and valid license attribution would be removed from the Play Store, the SEC said.