Technology

SECP has approved the first P2P Lending Platform under its regulation

In a press release issued today, the Securities & Exchange Commission of Pakistan (SECP) has approved the launch of the first Peer to Peer (P2P) Lending Platform in Pakistan. This comes after the establishment of the first cohort of Regulatory Sandbox to support and encourage the Fintech revolution in Pakistan.

P2P lending is an innovative alternative digital platform that connects borrowers with individual lenders, who come together to meet the borrowers’ loan requirements. The P2P lending helps the borrowers give out short-term loans that enable the Small and Medium Enterprises (SMEs) to scale up their business, eventually qualifying them to take bigger bank loans.

The current approval is only meant to test and experiment with a P2P lending platform that could eventually attribute towards the development of an ecosystem of SME financing to create new employment and business opportunities.

In the current stage, the P2P lending platform will operate within pre-defined parameters and is subject to certain terms and conditions. Specific eligibility criteria will also be applied to the selection of each lender/borrower on the platform.

The terms and conditions will be reevaluated helping the SECP devise an enabling regulatory framework for the FinTech industry to operate in.

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Tags: FinTechSECP

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