Due to their lack of registration with the government, a number of lending institutions are currently engaging in illegal activity.
Users are urged to be aware by the Securities and Exchange Commission of Pakistan (SECP) of the rising number of unregistered and illegally administered loan applications in the nation.
Before downloading the credit application or applying for credit, SECP advised anyone using it to read the full terms and conditions in the notice.
It is specifically requested of users confirm important loan information like interest and insurance rates, service fees, and late fees.
Any application load lending company in Pakistan must have a license. As a result, running applications without a license is illegal.
In this regard, SECP advises users to verify the lending application’s license. Additionally, the they states that applications operating under this license must adhere to all of its regulations or face legal action.
SECP set up a service desk management system to make it easier for customers to report loan applications that don’t meet the requirements.
Pakistan has seen an increase in applications for nano loan loans over the past year. It is said to have borrowed money from more than 2.4 million people, resulting in payments of more than Rs. 630 crores.
However, as the trend continues, complaints about applications for nanoloans are flooding his SECP portal. The majority of complaints that SECP receives concern things like high-interest rates, false disclosures, and threatening collections.