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Colorum and illegal! Online lending industry needs regulation — Romero

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House Deputy Speaker and 1Pacman Party-list Rep. Mikee Romero said online lending websites and cellphone applications operating in the country are “deemed illegal,” considering the lack of regulation governing the industry.

Romero made the statement after three major online lending companies recently were found guilty by the National Privacy Commission of violating the Data Privacy Act of 2012 for alleged public shaming of its borrowers who failed to pay their respective debts on time.

Romero said online lending websites as well as those can be downloaded using Android-operated smartphones can be considered colorum since its neither sanctioned by the Bangko Sentral ng Pilipinas (BSP) nor the Securities and Exchange Commission (SEC).

“Kasi iligal siya eh. Those are illegal, colorum ‘yan eh. Wala silang… they are not sanctioned by the BSP, they are not sanctioned by the SEC. So they just put it together, so it’s deemed illegal,” said Romero.

According to Romero, there is a need to regulate the online lending industry following reports that borrowers were allegedly being harassed by online lending companies through public shaming using the social media.

“Anything form of lending, it has to go through the proper channels. It should be regulated,” said Romero.

“Pag-aaralan namin and then we try to find out how to regulate it. Definitely kailangan ng regulation yan—whether app-based siya or just the regular online lending website,” he added.

Aside from proper regulation, Romero wants know if these app-based lending companies are paying proper tax obligations.

At least 15 local online lending applications can be downloaded by Android phone users using the Google Play store.

Online lending firms Fast Cash Global Lending Inc., Unipeso Lending Company Inc. and Fynamics Lending Inc. were recently found guilty for public shaming after posting the profile of alleged blacklisted borrowers in their respective Facebook accounts.

Officials of the company may face imprisonment of up to seven years and fines of not more than P5 million under the Data Privacy Act of 2012.

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