SEC may soon allow new online lending apps

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March 2, 2026 | 12:00am

MANILA, Philippines — The Securities and Exchange Commission (SEC) said it may allow once more the entry of new online lending platforms (OLPs) starting next month in an effort to help bring down further interest rates charged by financing and lending companies for specific loans.

SEC commissioner Rogelio Quevedo said the commission intends to lift its moratorium on the registration of new online lending platforms by April.

“The Securities and Exchange Commission will also timely lift the moratorium on online platforms. So we hope that by April 1, the SEC can lift the moratorium for online platforms and allow the entry of new players,” Quevedo said.

The SEC in November 2021 issued a moratorium on the registration of new OLPs of financing and lending companies in a move to stop abusive online financing and lending practices.

The commission then said it received numerous complaints relating to alleged violations by OLPs of existing regulations on the operation of, and the provision of lending and financing services, which resulted in the imposition of appropriate sanctions on erring entities.

“Frankly, the reaction of the SEC at that time was we were unable to react to the proliferation of financial scams. And so the reaction of the SEC was to impose a moratorium. Stop the proliferation of financial and lending companies at that time,” Quevedo said.

By lifting the moratorium, Quevedo said the SEC hopes to see more players come in, which in turn will lead to more competition and hopefully reduce further the interest rate that has already been lowered to 12 percent effective April.

“The reason why the moratorium will be lifted is so that there will be more lenders and more access by borrowers. We believe that if there is more competition, even the interest rate will actually be lowered. So that is one of the effects that we anticipate,” the SEC official said.

“So hopefully, there will be lesser need for the argument that the lenders, because of the high delinquency rate among the borrowers, they need the high interest rate. I emphasize: the good borrowers do not have to subsidize the bad borrowers,” he said.

Last December, the SEC issued Memorandum Circular 14 providing for recalibrated ceilings on interest rates and other fees charged by financing and lending companies.

Under the circular, the effective interest rate is capped at 12 percent per month, or about 0.4 percent per day.

The rate refers to the total nominal interest paid plus other fees and charges, excluding penalty and late payment fees, expressed as the rate that exactly discounts estimated future cash flows throughout the loan to the net amount of loan proceeds.

The ceiling for effective interest rates was previously set at 15 percent per month, or about 0.5 percent per day.

Lending and financing companies, meanwhile, may not charge nominal interest rates exceeding six percent per month, equivalent to 0.2 percent per day.

The recalibrated ceilings, which will apply to loans entered into, restructured or renewed beginning April 1, 2026, would cover unsecured and general-purpose loans offered by financing and lending companies with principal amounts not exceeding P10,000 and payment terms of up to four months.

Quevedo recently met with lending industry leaders to identify approaches to lower the cost of consumer loans and expand access to affordable credit.

The regulator and private sector players agreed that widening credit access requires strengthening the foundations of responsible lending, with improved data infrastructure emerging as central to delivering more inclusive financial services.

One of the things identified as essential to expanding responsible access to credit is to provide lenders with secure and consumer-authorized access to transaction data.

With regulator-mandated standards for security and authorization, this data enables more accurate risk assessment, broadening inclusion while maintaining strong and prudent underwriting standards.

Quevedo said the SEC, for its part, is at the forefront of strengthening credit regulation and is actively exploring systems that allow credit information to be shared more effectively among regulated institutions.

“We are also studying the use of technologies to strengthen borrower identity and data integrity. When lenders lack reliable credit history, risk premiums increase. Improving information sharing can help address that gap and support more affordable, responsible lending,” he said.