SEC revokes registration of 836 unlicensed lending companies

The Securities and Exchange Commission (SEC) has revoked the registration of 836 lending companies operating without the necessary license as part of its crackdown on illegal lending.

The SEC Corporate Governance and Finance Department (CGFD) revoked the registration of the latest batch of corporations and partnerships registered as lending companies, but did not get the required Certificate of Authority (CA) to Operate as Lending Company, the commission said on Wednesday.

The move has been resolved by the Commission En Banc during its July 4 meeting.

The list of lending companies is available on the SEC’s website.

Section 4 of Republic Act No. 9474, or the Lending Company Regulation Act of 2007, requires a lending company to be established only as a corporation.

It further provides that “no lending company shall conduct business unless granted an authority to operate by the SEC.”

Any person engaged in the business of lending without a valid 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, according to Section 12 of the Lending Company Regulation Act.

On November 14, 2016, the corporate regulator allowed SEC-registered lending companies without the required certificate of authority to apply for and secure a CA until April 30, 2017.

So far, a total of 2,783 lending companies were able to obtain the certificate of authority.

On the other hand, the SEC said it has revoked the registration of 2,080 lending companies. It continues to validate the authority of more corporations doing lending activities.

“Lending companies could play an important role in realizing the aspiration of Filipinos for a comfortable life by providing them access to funds for unforeseen and emergency expenses, major purchases as well as investments in their future,” SEC Chairperson Emilio Aquino said.

“To protect both the integrity of legitimate lending companies and the interests of borrowers, the Commission will remain relentless in going after informal lenders as well as those engaging in predatory, abusive and unfair lending practices,” Aquino said.

As part of efforts to formalize small lending businesses in the country, the SEC issued Memorandum Circular No. 18, Series of 2016, to streamline the documentary requirements of financing and lending companies.

Under the circular issued on November 8, 2016, the commission no longer requires financing and lending companies to submit quarterly reports, corporate governance scorecard, and for corporate secretaries to certify directors who attended meetings. —VDS, GMA News —VDS, GMA News