SEC shuts down 12 unregistered online lenders

enablePagination: false
maxItemsPerPage: 10
totalITemsFound:
maxPaginationLinks: 10
maxPossiblePages:
startIndex:
endIndex:

Twelve online lending firms have been padlocked by the Securities and Exchange Commission for operating without licenses.

Metro Manila (CNN Philippines, October 14) — The Securities and Exchange Commission (SEC) crackdown erring online lending companies continues, with the regulator shuttering 12 firms found operating without a license.

In a statement, the SEC announced Monday that a new set of online lenders have been ordered to stop operations upon discovery that they have not been authorized to provide easy credit to the public, with some even unregistered with the SEC.

Ordered shut were:

- A&V Lending Mobile

- A&V Lending Investor

- A.V. Lending Corporation

- Cashaku

- Cashaso

- CashEnergy

- Happy Loan

- Peso Pagasa

- Vito Lending Corp.

- Phily Kredit

- Rainbow-Cash

- Rainbowcash.Ph Lending Corp.

The SEC issued the closure orders on October 10, saying these unregistered or unlicensed lending firms violate the Lending Company Regulation Act of 2007. They can face a fine worth ₱10,000 to ₱50,000 or up to 10 years in jail.

"Based on the findings of the SEC Corporate Governance and Finance Department, the online lending applications and their operators are not registered as a corporation or partnership and/or have not been issued certificates of authority to operate as lending or financing companies," the SEC said.

A.V. Lending Corporation and Vito Lending Corp., which are supposed to be the parent firms of A&V Lending, Peso Pagasa and Rainbow-Cash, were not registered in the SEC database.

Like in previous cease and desist orders, the SEC stepped in after receiving complaints that these lending companies gained access to a borrower's list of contacts in their cellphones and sent them text blasts about how the person has not been paying his or her dues on time.

If these didn't work, defaulting borrowers are threatened with lawsuits or public shaming.

“Considering that the online lending operators are not incorporated entities or have no Certificate of Authority to Operate as Lending Companies or Financing Companies, the lending activities and transaction are illegal and have to be stopped immediately by this Commission,” read the cease and desist order issued by the SEC.

The SEC previously said that the online shaming of delinquent borrowers has caused depression, sleepless nights, and other health issues. Prior to this 30 other lending companies have been shuttered.