SECP has introduced a new framework to empower digital lenders and promote financial inclusion. This framework aims to balance innovation in the digital lending space with strong consumer protection measures.
Following collaboration with industry stakeholders, the SECP released Circular 12 of 2024. This circular streamlines existing regulations by consolidating requirements from previous circulars and introducing amendments. The revised framework prioritizes innovation by introducing new product categories like embedded lending via APIs, buy now pay later services, and employer integrated earned wage access.
Embedded lending allows seamless integration of lending options within existing platforms, while BNPL services provide consumers with flexible payment options. Employer integrated earned wage access empowers employees with earlier access to their earned wages.
The SECP’s revised guidelines also aim to enhance access to financing for small and medium enterprises (SMEs) through business-to-business financing channels. Additionally, the framework allows the integration of multiple Non-Banking Financial Companies (NBFCs) with approved digital lending platforms through APIs. This expands lending opportunities for a wider range of borrowers.
This initiative by the SECP signifies a commitment to building a robust digital lending ecosystem in Pakistan. The framework prioritizes transparency, data protection, and the development of innovative financial solutions that cater to the needs of both consumers and businesses.
