SECP apprised digital lenders on new regulatory requirements

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ISLAMABAD
The Securities and Exchange Commission of Pakistan (SECP) briefed the non-banking finance companies (NBFCs) on improved regulatory requirements, recently imposed through Circular No 15 to address the complaints of mis-selling, inflated charges and undue access to customers’ data.
Senior management of all the licensed NBFCs, engaged in digital lending participated in the online session. Giving an overview of the circular’s key requirements, SECP Executive Director Khalida Habib informed the participants that the SECP has imposed restrictions on deducting upfront charges from the lent amount. Moreover, the lending companies stopped from operating more than one digital App at Google Play store or any other platform. However, they can launch different products and schemes under one Master App.
Companies that are already running more than one App, have been asked to identify one Master App and shutdown the other apps within 90 days. The companies are also required to maintain confidentiality of user data and provide audit reports of their apps from a PTA approved IT security audit firm. Digital lenders are also required to disclose their full corporate name on their mobile applications. SECP’s Additional Joint Director Ahmad Abdul Moiz Khawaja briefed the participants on regulations regarding clear disclosures of loan terms & conditions, requirements of managing credit risk, advertisements, grievance redressal systems and loan collection methods.