ISLAMABAD: The Securities and Exchange Commission of Pakistan (SECP), the regulator of the non-banking finance sector, has taken strict action against illegal loan apps that were operating without its approval and posing a threat to the public.
The SECP, in collaboration with Google, Apple, and the Pakistan Telecommunication Authority (PTA), has identified and blocked 120 illegal loan apps that were previously available on Google Play and Apple stores. The SECP has also referred these apps to the Federal Investigation Agency (FIA) for further action under the Prevention of Electronic Crimes Act of 2016.
The SECP has stated that it has not only strengthened its regulatory framework for licensed Non-Banking Finance Companies (NBFCs), but has also taken effective measures in coordination with relevant authorities to shut down unauthorised and illegal loan apps.
The SECP has warned the public to avoid falling into debt traps of illegal loan apps, which may misuse their personal data, charge exorbitant fees, and employ coercive recovery practices. The SECP has advised the public to obtain loans only from licensed NBFCs, which are required to disclose transparent and fair terms and conditions.
The SECP has also initiated inspections of licensed NBFCs that provide loans through apps to verify that they are complying with the SECP’s rules and regulations. The SECP has urged the public to report any illegal loan app or investment scheme, as well as any misconduct by the licensed NBFCs, through its dedicated complaint portal.
The SECP’s actions are aimed at protecting the interests of the borrowers and investors, as well as promoting a healthy and competitive non-banking finance sector in Pakistan.