Philippine securities regulator tightens rules for online lending platforms

The Philippines' securities regulator is tightening rules for financing and lending companies that use or seek to use financial technology for their loan products and services.

The Philippines' Securities and Exchange Commission released Nov. 19 the new framework that will guide the licensing of new online lending platforms as well as existing companies seeking to deliver credit products and services online.

Under the guidelines, companies will not be permitted to own and operate an online lending platform without the approval of the regulator. The name of the platform must also be registered as business or trade names of the financing or lending company.

Entities applying for a license will be required to submit a detailed business and operational plan, including process flows on customer onboarding and know-your-client procedures as well as consumer protection policies and service level agreements.

The license will have an initial validity period of one year upon issuance, subject to conditions.