More online lending apps ordered shut down by SEC

THE Securities and Exchange Commission (SEC) has issued a cease and desist order (CDO) against 11 more online lending applications due to various violations.

The CDO, dated Friday, Sept. 20, 2019, was issued against Cash Whale, Cash 100, Cashafin, CashMaya, CashFlyer, Cashwarm, Cashope, Cashwow, Creditpeso, ET Easy Loan and Peso2Go.

The Commission said the lending applications were operated by unlicensed persons and operating on unreasonable and abusive lending and collection practices.

Online lending applications offer convenient and faster processing. That is why more people prefer to use online lending apps.

CashWhale app promised a more convenient installment payment and a service fee that would be charged one-time, ranging from zero to 20 percent, with an interest rate of one percent per day.

Violation

The apps offer easy processing and fast releasing of loan proceeds.

Of the 11 suspended apps, Cashope has the most number of downloads at 1,942 on Playstore. Most the apps are not available on App Store.

Last Sept. 12, SEC also issued a CDO against the operations of 19 online lending applications: Instant Pera, QuickPera, Lendmo Philippines, Binixo, CashBus, Cashcat, Cashuttle, Crazy Loan, Flash Cash, Happy2Peso, Hatulong, MeLoan, MoneyTree Quick Loan, Pera Express, Pera4u, Peramart, PesoLending, QuickPeso and Umbrella.

SEC said the apps violated Section 4 of Republic Act 9474, or the Lending Company Regulation Act of 2007, which requires a lending company to be established as a corporation. It further provides that “no lending company shall conduct business unless granted an authority to operate by the SEC.”

Any person who shall engage in the business of lending without a validly subsisting authority to operate from the SEC may face a fine ranging from P10,000 to P50,000 or imprisonment of six months to 10 years, or both, under Section 12 of the Lending Company Regulation Act.

The SEC Corporate Governance and Finance Department found that these online lending apps do not have the required certificates of authority to operate a lending or financing company.

Revoked certificates of authority

The Commission also ordered the online lending operators to cease from offering and advertising their lending business through the internet and to delete or remove promotional presentations and offerings of such lending business from the internet, including the lending applications that they operate.

As part of its crackdown on illegal lending, the Commission has also revoked the certificates of registration of 2,081 lending companies for their failure to obtain the required certificate of authority to operate as a lending or financing company.

In 2019 alone, the SEC has revoked the registration of 837 unlicensed lending firms.

It also revoked the certificates of authority of Z.C. Buen Mano Lending Corp. for failing to comply with the reportorial and other compliance requirements prescribed by the Commission and Moola Lending Corp. for charging fees that were either higher or unauthorized. RSR with PR

Our goal is to create a safe and engaging place for users to connect over interests and passions. In order to improve our community experience, we are temporarily suspending article commenting