SEC Lifts Moratorium on New Online Lending Platforms and Issues Updated Regulatory Framework

The Securities and Exchange Commission (SEC) has issued Memorandum Circular No. 20, Series of 2026, lifting, effective 1 August 2026, the moratorium on the disclosure and recording of new Online Lending Platforms (OLPs). The Circular introduces a comprehensive regulatory framework governing the operation of OLPs by Financing Companies (FC) and Lending Companies (LC), including prudential capital requirements, disclosure obligations, and market conduct standards.

The Circular applies to all FCs and LCs, including existing entities, newly registered companies, and those with pending registration applications. It adopts a Single Certificate of Authority (CA) policy under which each company is issued only one Certificate of Authority covering all of its financing or lending activities, regardless of the number of branches or operational channels. Under this framework, an OLP is treated solely as an operational channel rather than a separate licensed entity, and no separate Certificate of Authority is required for its operation.

To strengthen prudential regulation, the Circular prescribes minimum capitalization requirements and limits each company to a maximum of five (5) OLPs. For new companies, the minimum paid-up capital is ₱15 million for FCs and ₱5 million for LCs, without prejudice to higher requirements applicable to OLP operations. LCs operating one OLP must maintain a minimum paid-up capital of at least ₱10 million, while FCs must maintain at least ₱20 million. The required paid-up capital increases progressively for every additional OLP up to ₱50 million for LCs and ₱100 million for FCs operating the maximum allowable five OLPs. Existing OLP operators are given twelve months from the Circular’s effectivity to comply with the applicable capital requirement. Newly registered companies are likewise required to submit a comprehensive business plan within sixty (60) days from the issuance of their Certificate of Authority.

The Circular also strengthens consumer protection and transparency requirements. Each OLP Name must be duly registered and disclosed to the SEC as business names or trade names of the FC or LC and must not mislead borrowers regarding the identity of the company responsible for the OLP. The companies must disclose to the SEC and maintain accurate and updated information regarding each OLP, including its name, borrower-facing identity, website, mobile application, domain names, and platform links. Upon opening the OLP, or at the lates before loan confirmation, borrowers must be clearly informed of the loan amount, applicable interest rates, fees and charges, payment schedule, loan term, and other material information required under the Truth in Lending Act (TILA). In addition, operators must likewise comply with the Data Privacy Act (DPA), register with the Credit Information Corporation (CIC), and observe fair marketing and debt collection practices.

The lifting of the moratorium does not constitute the automatic or unconditional approval of any OLP. The SEC retains the authority to refuse, suspend, or delist Online Lending Platforms that fail to comply with the Circular. Existing operators likewise acquire no vested right to continue operating under arrangements inconsistent with the new framework. Violations may result in administrative sanctions, including monetary penalties, suspension of operations, or the revocation of the company’s Certificate of Authority.