The Philippine Securities and Exchange Commission (SEC) has proposed lifting a moratorium on new online lending platforms, reopening the market to new digital lenders while imposing tougher capital, disclosure, and consumer-protection rules on financing and lending companies.
The draft circular, published for comment on March 11, would formally lift and supersede SEC Memorandum Circular No. 10 of 2021, which had halted the recording of new online lending platforms, or OLPs.
Under the draft rules, the SEC said financing and lending companies would again be allowed to disclose and operate new OLPs, but only subject to enhanced safeguards covering capitalization, business-plan disclosures, market conduct and supervisory requirements.
The proposal makes clear that lifting the moratorium would not amount to automatic approval for any platform.
The proposed framework would require companies to submit a pre-disclosure classification declaration before deploying a digital platform, allowing the SEC to determine whether it qualifies as an OLP based on the functions it performs.
The regulator adopts a substance-over-form test, meaning platforms would be judged by whether they carry out core lending functions such as onboarding, credit assessment, pricing, contract execution, servicing and collection, rather than by branding or technical structure.
The draft also introduces higher paid-up capital requirements, especially for firms operating online platforms.
Financing companies with no OLPs would need at least 20 million pesos in paid-up capital, while lending companies would need 10 million pesos.
For those operating OLPs, the thresholds rise depending on the number of platforms: financing companies would need 30 million pesos for one OLP, 60 million pesos for two to five, and 100 million pesos for as many as 10; lending companies would need 20 million pesos, 30 million pesos and 50 million pesos, respectively.
No firm would be allowed to operate more than 10 OLPs. Existing players would be given a three-year transition period to comply.
The SEC is also proposing stricter operating standards for online lenders.
These include standardized Truth in Lending disclosures, data-privacy safeguards, a ban on unauthorized or automated loan disbursements without borrower confirmation, mandatory use of Credit Information Corp. data in underwriting, and curbs on debt-collection practices.
Automated collection messages would be prohibited except for neutral payment reminders, while lenders would be barred from accessing borrowers’ contact lists or using personal data to harass or shame borrowers.
The draft likewise revises annual licensing fees by replacing branch-level charges with an entity-level, asset-based fee structure starting Jan. 1, 2027, with payment due by Dec. 31 each year.
It also adopts a single certificate-of-authority policy covering a company’s principal office and all branches.
The SEC is accepting comments until March 25. If approved, the circular would take effect on April 1, 2026.
The proposal signals a calibrated reopening rather than a broad deregulation of online lending. The SEC appears to be trying to restart innovation in fintech credit after years of tighter scrutiny, while addressing longstanding complaints around hidden charges, abusive collections, misuse of borrower data and thinly capitalized operators.
The higher capital thresholds and the cap on the number of OLPs could favor better-funded players and push weaker firms to consolidate.