Registering Digital Lenders and Platforms

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In the Philippines, the National Privacy Commission (NPC) issued a warning asking prospective borrowers to check the terms and conditions carefully before downloading a mobile application. It warned online lenders not to seek unnecessary information, including phone or social media contacts, from prospective clients without permission, and not to use the information they gather to harass clients. And in Indonesia, the OJK, the government agency that regulates the country’s financial service sector, issued circulars advising the public to carefully select their digital lender. In addition, to help improve transparency, the OJK also listed licensed fintech korea whatsapp number dataplayers on their website.

Across all three markets, company registration is required to do business, so regulators often use it as a checkpoint to identify substandard fintech. In the Philippines, lending companies are required to register as “online platforms” with the Securities and Exchange Commission (SEC) and to submit an affidavit of compliance with the registration process. Any failure of compliance is treated as a criminal offense that subjects the company to penalties. Indonesia takes a slightly different approach: The OJK has made it compulsory for peer-to-peer lending platforms to undergo a trial registration for the first 12 to 18 months. During the trial period, the OJK closely monitors a company’s adherence to regulations — then, based on a performance review of the company, it decides whether to allot it a full business license. In India, Non-Bank Financial Companies are registered by either the RBI or state governments. But since these entities function independently without any coordination, there’s a risk of dilution of oversight at the point of registration.

Ensuring Data Privacy Regulation for Fintech: With increasing digitization, data privacy is a critical issue that every regulator is trying to address. The Philippines is ahead of both India and Indonesia in the implementation of privacy regulations. Its Data Privacy Act of 2012 is applicable to fintech: It covers data protection (including consent requirements and customers’ right to ask companies to delete their personal data), and requires companies to notify the National Privacy Commission when data from third-party providers is utilized for loan decisions. Also, lenders are required to hire data protection officers to monitor and ensure compliance with the Act. Out of concern over predatory digital lending apps, the NPC is actively ensuring the implementation of the Data Privacy Act by making data protection audits compulsory. Meanwhile, in India, the RBI has set up a Working Group on Digital Lending as an immediate response to irresponsible lending apps and has directed it to provide robust data governance, privacy and security standards for the deployment of digital lending services. And in Indonesia, the OJK is working with the national Parliament to prioritize personal data protection, cybersecurity and cyber resilience bills.