SECP Bans 120 Online Loan Apps & Issues New Guidelines – Discover More!

FIA launched a massive crackdown on lending apps after a man committed suicide a few months ago as he was to pay back the loan. Afterward, the authorities directed the Securities and Exchange Commission of Pakistan (SECP) to block the online lending apps and cancel the registration of the respective companies. As per a source, the Securities and Exchange Commission of Pakistan (SECP) has blocked around 120 online loan applications in Pakistan. According to the details, the newly updated list of online lending apps has been published on the SECP website.

However, on the other hand, an official statement of SECP suggests that the app operators are now using different channels as an alternative to Google and Apple Play Store. Therefore, the commission has advised users to download applications only from the verified Play stores.

Furthermore, according to a press release, SECP issued an all-inclusive set of requirements for Non-Banking Financial Companies (NBFCs) providing digital personal loans through mobile apps. Back in August, the commission introduced a new set of rules for online lending apps to put a halt on predatory practices and guarantee the financial sustainability of the borrowers.

SECP set stricter rules for online loan apps by putting maximum limits on loans, loan periods, restrictions on the use of the debtors’ personal data, and others. A maximum limit of PKR 25000 has been set for individual borrowers from a single loan app, and the aggregate amount of loans from various Apps has been restricted to not exceed PKR 75,000. Moreover, the loan period for a nano-loan via personal loan apps has been limited to not more than 90 days.

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SECP Introduces Pricing Caps for Online Loan Apps to Ensure Borrower Protection