Google has updated its “Personal Loans Policy” for users in Pakistan by introducing additional requirements for personal loan apps. As part of the update, Google has mandated that personal loan apps operating in Pakistan must provide country-specific licensing documents to demonstrate their ability to offer personal loans. The new policy also prohibits these apps from accessing users’ contacts or photos.
Pakistan is the sixth country after India, Indonesia, the Philippines, Nigeria, and Kenya for which Google has introduced such requirements for digital lending apps. This update was introduced after several meetings between Google and the Securities and Exchange Commission of Pakistan (SECP), the regulator of the corporate sector in Pakistan.
The SECP has received numerous complaints about registered and non-registered lending apps indulging in exploitative and coercive practices, including blackmailing their customers. The SECP has also taken action against non-banking finance companies (NBFCs) that have launched their digital apps, limiting each NBFC to publish only one lending app.
In response to queries regarding 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, along with certificates issued by PTA-approved audit firms, signifying their commitment to protecting customer data.
Apart from the policy framework, consultations have been held with Google, Apple, mobile wallet, and telecom service providers to take down apps operating from outside Pakistan. Currently, there are about 10 licensed NBFCs and only three digital lending apps in Pakistan, while around 30-40 unlicensed apps are operating from outside the country.