Google has updated its “Personal Loans Policy” for Pakistani users by introducing new requirements for personal loan applications. Google has mandated, as part of the update, that personal loan applications operating in Pakistan provide country-specific licencing documents to demonstrate their ability to offer personal loans. The new policy prohibits these applications from accessing the contacts and photos of users.
After India, Indonesia, the Philippines, Nigeria, and Kenya, Pakistan is the sixth country for which Google has imposed such requirements for digital lending applications. Following several meetings between Google and the Securities and Exchange Commission of Pakistan (SECP), the corporate sector regulator in Pakistan, this update was released.
The SECP has received numerous complaints alleging that both registered and unregistered lending apps engage in exploitative and coercive practices, such as blackmailing their customers. The SECP has also taken action against non-banking finance companies (NBFCs) that have released digital lending applications, limiting each NBFC to publishing only one lending application.
In response to questions about the SECP’s actions against illegal and unregistered lending apps, a senior commission official stated that three lenders have already provided their Cyber Security Audit Reports and certificates from PTA-approved audit firms, demonstrating their commitment to protecting customer data.
In addition to the policy framework, consultations have been held with Google, Apple, mobile wallet, and telecommunications service providers regarding the removal of apps operating outside Pakistan. In Pakistan, there are approximately ten licenced NBFCs and only three digital lending apps, whereas approximately thirty to forty unlicensed apps operate from outside the country.