SEC halts Microdot Lending to protect borrowers

The Securities and Exchange Commission (SEC) has stopped Microdot Lending Corp.’s operations after finding that the firm engaged in unfair debt collection practices and failed to disclose several of its online lending platforms (OLPs), actions the regulator said could harm the borrowing public.

Citing a cease and desist order (CDO) dated 23 September, the SEC said Thursday its Financing and Lending Companies Department (FinLend) directed Microdot, its OLPs, and all persons acting on their behalf to immediately halt lending promotions and transactions.

The order covers the company’s OLPs MF Cash, Credit Cash, Credit Peso, Pesoloan Mart, Cash Baka, Cash Mabilis, Go Peso, Instant Loan, and Timely Loan.

FinLend’s investigation showed that Microdot failed to disclose the operations of Credit Peso Pro and MF Cash, in violation of SEC Memorandum Circular No. 19, Series of 2019, which requires lending firms to report all existing OLPs.

The SEC said it has received multiple complaints against Microdot since 2024 over alleged abusive debt collection tactics, which contravene the implementing rules of Republic Act No. 11765, or the Financial Products and Services Consumer Protection Act (FCPA).

Microdot also violated Rule 8(c) of the IRR of Republic Act No. 9474, or the Lending Company Regulation Act, for repeatedly ignoring SEC directives, including show cause and assessment letters and audit findings.

“[Microdot’s] operation of the undisclosed OLPs, blatant disregard of the SEC’s regulatory authority over it, and practice of unfair debt collection, may unjustly cause grave or irreparable injury or prejudice to the borrowing public, thereby imperiling their rights as enshrined in the FCPA,” the order stated.

“Additionally, its employment of unfair debt collection practices, shown and established by substantial evidence, is a violation of the SEC-FCPA-IRR and should be immediately halted to safeguard the rights of its borrowers,” it added.