The Securities and Exchange Commission (SEC) said in a media release on Tuesday that GOOGLE was undergoing a more rigorous approval process for online loan applications in the Philippines.
“Developers providing personal loans to Google in the Philippines must submit a personal loan app declaration, and submit the required documentation before releasing the app in the Google Play Store,” the SEC said.
The decision was recommended by the SEC to deal with the practice of illegal and objectionable loans.
In the declaration, developers must state that they are registered and duly licensed by the SEC to operate an online transaction platform (OLP) or to perform lending-based crowdfunding activities such as peer-to-peer lending. To act as a crowdfunding intermediary.
Developers also need to make sure they are engaged in a legitimate business activity and doing the same in compliance with applicable law.
In the Philippines, personal loan apps operated without proper announcement and licensed attribution will be removed from the Play Store, the commission said.
Individuals or entities acting as lenders must be registered as a corporation and the authority required to operate must be protected from the SEC.
Similarly, financing companies must register with the SEC as a corporation and secure an authority to conduct such operations separately from the commission.
The commission further wants the financing and lending agencies to register their OLPs as business names as well as publish their corporate names, SEC registration numbers and certificates of authority numbers in their OLPs and advertisements.
In November 2021, the Commission imposed a moratorium on new OLPs when it drafted guidelines on the registration and licensing of OLPs.
Only persons registered until November 2 can operate and use online loans or financing subject to strict supervision.
“We thank Google for supporting our efforts to fight illegal and abusive lending and thus protecting the integrity of the financing and lending industry and providing Filipinos with secure and accessible financing options,” said SEC Chairperson Emilio B. Aquino said in a statement:
“We are positive that the additional requirements imposed by Google for developers of personal loan apps targeting Filipino users will serve as another level of protection for Filipino borrowers and a deterrent against predatory loans,” Mr Aquino added.
Since 2019, the SEC has said it is in correspondence with Google to address the proliferation of unregistered personal loan apps.
“In addition to reporting and requesting the removal of unlicensed lending apps from the Google Play Store, the commission directed the US-based technology giant to verify the legitimacy of lending and financing companies seeking to develop and publish their apps,” the SEC added. – Luisa Maria Jacinta c. Jackson