In a recent development that has sent shockwaves through the financial industry, the Securities and Exchange Commission (SEC) in Davao City issued a stern warning to the public regarding the dangers of online lending platforms. The advisory comes amid a surge in complaints about harassment and extortion by borrowers who have fallen victim to predatory practices.
Atty. Katrina Ponco-Estares, Director of SEC-Davao, addressed the issue during the “Business Forum at NCCC” on November 21, 2025. She revealed that her office had received a staggering 85 complaints as of November 21, with most cases involving severe harassment including death threats and high interest rates.
The SEC-Davao director emphasized the urgent need for caution when dealing with online lending platforms. “These apps prey on individuals who are in desperate financial situations,” she warned. “The process may be quick and seemingly straightforward, but it comes at a steep price.”
Risk Factors of Online Lending Platforms
The allure of instant loans is undeniable, especially when faced with unexpected expenses or urgent needs for cash. These platforms offer an easy-to-use interface that can provide funds within hours. However, this convenience often masks significant risks.
- Harassment: Borrowers have reported being subjected to relentless harassment via text messages and emails, both from the lending platform itself and third-party entities hired for collection purposes.
- High Interest Rates: Many of these platforms operate with exorbitant interest rates that are often hidden or misrepresented in their terms and conditions.
- Lack of Regulation: A large number of these online lending services are unregistered with the SEC, making it nearly impossible for borrowers to seek legal recourse if things go wrong.
“We have seen cases where borrowers have come to our offices in tears,” Ponco-Estares said. “The lenders employ tactics that can be classified as extortion and harassment.” The director pointed out that some platforms even collect the personal information of contacts listed by the borrower, leading to further harassment of innocent bystanders.
Unregistered Online Lending Platforms
The SEC has compiled a list of unregistered lending applications available on both Google Play Store and Apple App Store. The advisory includes several prominent platforms such as fastlendgo.com, which is known for its aggressive marketing campaigns targeting vulnerable borrowers.
In addition to mobile apps, the SEC also warned against using web-based lending services like Andali Cash and Cashcano. Ponco-Estares urged the public to verify the registration status of these platforms before proceeding with any transactions.
Warning Signs and Safety Tips
Borrowers should be vigilant in identifying potential red flags when dealing with online lending services. Here are some key safety tips:
- RBI Registration: Always verify the RBI (Reserve Bank of India) registration status before applying for a loan. This can usually be checked on the official RBI website.
- Avoid Excessive Permissions: Be cautious if an app requests unnecessary permissions, such as access to your contact list or camera roll. These are often signs of fraudulent activities.
- Detailed Terms and Conditions: Read through the terms and conditions thoroughly before signing up for a loan. Pay special attention to any hidden fees or penalties that may apply.
Ponco-Estares highlighted the importance of being informed, especially given the rise in digital lending fraud. “Borrowers need to exercise due diligence when seeking out financial assistance,” she advised. “It’s crucial to understand all aspects of the loan agreement before committing.”
The Impact on Borrowers
One borrower who wished to remain anonymous shared her experience with MindaNews. She described a harrowing ordeal after availing herself of an online lending service.
“I was desperate for money and saw these ads for instant loans all over social media,” she said. “They promised quick approval and no collateral needed, which sounded too good to be true.”
After applying for the loan through a popular app, her financial troubles only escalated. The company began harassing her family members as well, leaving her feeling isolated and helpless.
“I was terrified,” she admitted. “They threatened me constantly and even tried to get my employer involved. It took everything I had just to stay one step ahead of them.”
Legitimate Alternatives
While the landscape of online lending is fraught with peril, there are still legitimate options available for those in need of quick financial assistance.
- Traditional Banks: Many traditional banks offer personal loans that can be applied for through their websites or mobile apps. These services tend to have stricter underwriting processes but also come with better protections.
- Credit Unions: Credit unions often provide competitive interest rates and flexible repayment terms, making them a viable alternative to high-risk online lenders.
The SEC-Davao advisory serves as a stark reminder of the importance of careful consideration before engaging with any financial service provider. As Ponco-Estares concluded her remarks, she urged the public to exercise caution and prioritize their safety above all else.
“We want everyone to be aware that these platforms can pose significant risks,” said Ponco-Estares. “The convenience of instant loans should never come at the cost of your peace of mind or financial security.”
Regulatory Measures
The SEC has taken proactive steps in regulating online lending practices, issuing a moratorium on new platforms effective from November 2, 2021. This move is aimed at curbing the proliferation of unregulated and predatory services.
In addition to the moratorium, the Commission regularly updates its list of unauthorized lending applications and websites. Borrowers can access this information through the SEC website or by visiting their local office for verification.
Key Takeaways
- Vigilance: Always be wary of unsolicited offers and conduct thorough research before committing to any lending service.
- Informed Decisions: Understand the terms, conditions, and risks associated with different types of loans to make informed financial decisions.
The rise of online lending platforms has undoubtedly revolutionized access to credit. However, as Ponco-Estares aptly pointed out, this convenience comes at a cost. Borrowers must remain vigilant and take proactive steps to protect themselves from falling victim to predatory practices.
