November 30, 2022

Technology giant Google is adopting a more stringent approval process for online lending apps in the Philippines, as recommended by the Securities and Exchange Commission, as part of efforts to tackle illegal and abusive lending practices.
Effective May 11, Google will require developers offering personal loans in the Philippines to submit a Personal Loan App Declaration and documentation before they could publish apps on Google Play Store.
In the declaration form, developers shall state that they are registered with and duly licensed by the SEC Philippines to operate an online lending platform (OLP), or to perform lending-based crowdfunding activities, such as peer-to-peer lending, or to act as a crowdfunding intermediary.
Also, developers shall confirm that they are engaged in a lawful business activity and are undertaking the same in compliance with the applicable laws.
Personal loan apps operating in the Philippines without proper declaration and license attribution will be removed from the Play Store. In the event where the submitted license, registration or declaration is no longer valid under the applicable laws, the developers are required to promptly remove the app from Google Play Store.
Republic Act 9474, or the Lending Company Regulation Act of 2007, requires persons or entities operating as lending companies to register as corporations and to secure from the SEC authority to operate.
Republic Act 8556, or the Financing Company Act of 1998, also requires financing companies to register with the SEC as corporations and to secure separately from the Commission an authority to operate as such.
Under SEC Memorandum Circular 19, s. 2019, the Commission further requires financing and lending companies to register their OLPs as business names, as well as disclose their corporate names, SEC registration numbers, and certificate of authority numbers in their OLPs and advertisements.
In November 2021, however, the Commission imposed a moratorium on new OLPs while it drafted guidelines on the registration and licensing of OLPs. Under SEC Memorandum Circular 10, s. 2021, only those registered as of Nov. 2, 2021 may operate and be used for online lending or financing, subject to strict monitoring.
“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 B. Aquino said.
“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.”
The SEC has been in correspondence with Google since May 2019 to address the proliferation of unregistered personal loan apps. Aside from reporting and requesting for the removal of unlicensed lending apps from Google Play Store, the Commission has enjoined the U.S.-based technology giant to verify the legitimacy of lending and financing companies looking to develop and publish their apps.
The Philippines is only the third country where Google will implement the additional requirements for developers of personal loan apps in order to curb the proliferation of illegal and abusive lending activities online, the other two being India and Indonesia. – Press release