Google has introduced additional requirements for digital lending apps in Pakistan, according to an article published on April 11, 2023.
Personal loan apps targeting users in Pakistan are now required to submit country-specific licensing documentation to prove their ability to provide or facilitate personal loans.
Additionally, Google has restricted personal loan apps from accessing user contacts or photos. The Securities and Exchange Commission of Pakistan (SECP) is working with stakeholders such as Google-Asia Pacific, Apple, mobile wallet operators, and Telecom Service Providers to ensure that all digital lending platforms comply with regulatory requirements and safeguard consumers’ interests.
Furthermore, each non-banking finance company (NBFC) can only publish one digital lending app, and developers who attempt to publish more than one app per NBFC risk the termination of their developer account and any other associated accounts.
Digital lending apps must complete the Personal loan app declaration for Pakistan and provide the necessary documentation, including proof of approval from the SECP and compliance with applicable regulatory and licensing requirements.
SECP has identified several instances involving the use of e-wallet accounts and API integration facilities of various banks/EMIs by unlicensed digital lending apps. To prevent unlicensed or illegal digital lending apps from using banking channels, SECP is working with the State Bank of Pakistan to formulate a policy.
The SECP has also engaged in discussions with major market players in e-wallet accounts, which hold almost 90% of the branchless banking market share in Pakistan, to address the issue of unlicensed digital lending apps/platforms/entities utilizing their banking services.
According to the article, licensed Non-Banking Financial Companies (NBFCs) disbursed loans exceeding Rs. 74 billion to more than 4.5 million individuals through digital lending applications within the confines of Pakistan in 2022. However, a growing number of illicit digital lending applications and platforms have been reported in Pakistan, leading to consequential harm to consumers.
Source: https://pkrevenue.com/google-introduces-new-requirements-for-digital-lending-apps-in-pakistan/