Complaints against online lending platforms (OLPs) in the Philippines are increasing, with regulators pointing to illegal operators, high interest rates, and abusive collection practices as main concerns, according to the Securities and Exchange Commission (SEC).
Speaking at the 44th National Credit Congress of the Credit Management Association of the Philippines (CMAP), Javey Paul Francisco, commissioner of the SEC, said the agency’s real-time complaints data shows a sharp increase in consumer issues involving unregistered OLPs, unfair debt collection, and weak disclosure of loan terms. The trend indicates growing risks as more Filipinos turn to digital lending apps for fast credit access.
“Digital lending has the potential to expand access and drive growth, but without strong governance, it can undermine the very trust that sustains the credit system,” Francisco said.
Francisco said the problem goes beyond access to credit, highlighting deeper issues in how loans are priced, disclosed, and collected. These factors, he said, are critical to building public trust in the country’s credit ecosystem, especially as fintech adoption accelerates and more borrowers rely on mobile-based lending services.
To address these risks, the SEC is shifting from reactive enforcement to a preventive, system-wide regulatory approach through proposed OLP Guidelines. The framework aims to tighten market entry rules, improve oversight of digital lending platforms, and enforce stricter standards on data privacy, transparency, and consumer protection. It also seeks to create a level playing field for compliant lenders while holding abusive operators accountable.
Francisco said regulatory principles such as fair pricing, clear disclosure, and respectful treatment of borrowers remain non-negotiable, regardless of technological advances. He added that lenders cannot pass accountability to third-party service providers, particularly in outsourced collection or data processing activities.
He also noted the growing role of artificial intelligence (AI) and data-driven systems in lending, noting that while these tools can expand financial inclusion, they must be paired with safeguards to prevent misuse and protect borrower rights.
The National Credit Congress, held during Credit Consciousness Week, gathered stakeholders from banks, fintech firms, and regulators to discuss digital lending trends, credit risk management, and strategies to strengthen consumer trust in the Philippine financial system.