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Tuesday, May 27, 2025
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SEC Revokes Digido Finance License for Unauthorized Branch Operations
Digido Finance Corporation's financing license is canceled after the operation of unapproved branches in Cavite.
The Securities and Exchange Commission (SEC) has officially canceled the financing license of Digido Finance Corporation due to the unauthorized operation of four branches in the province of Cavite.
The cancellation occurred following an order issued on May 9 by the SEC's Financing and Lending Companies Department (FinLenD).
Digido Finance Corporation was found to have violated Section 6(A) of the Implementing Rules and Regulations of the Financing Company Act of 1998. This regulation prohibits financing companies from establishing or operating a branch, agency, extension office, or unit without obtaining a Certificate Authority from the Commission.
The branches in question were reportedly located in the cities of Bacoor, Kawit, Dasmariñas, and General Trias.
Prior to the license revocation, the SEC had issued show cause letters to Digido regarding these operations.
In its defense, Digido claimed that the four locations were merely temporary exhibit booths designed for marketing purposes and not permanent branches due to their limited operational scale and the short duration for which they were established.
However, the SEC countered this argument, noting that the company utilized social media to promote loan services that could be processed within 10 minutes at these booths.
The SEC indicated that this advertising activity suggested that the company intended to operate these booths as functioning branches, and therefore, the assertion of them being non-permanent and small did not exempt the company from regulatory compliance.
The revocation of Digido's financing license underscores the regulatory framework designed to ensure proper operation within the financial sector, emphasizing the importance of adherence to established guidelines and the need for prior authorization before commencing any branch operations.
The cancellation occurred following an order issued on May 9 by the SEC's Financing and Lending Companies Department (FinLenD).
Digido Finance Corporation was found to have violated Section 6(A) of the Implementing Rules and Regulations of the Financing Company Act of 1998. This regulation prohibits financing companies from establishing or operating a branch, agency, extension office, or unit without obtaining a Certificate Authority from the Commission.
The branches in question were reportedly located in the cities of Bacoor, Kawit, Dasmariñas, and General Trias.
Prior to the license revocation, the SEC had issued show cause letters to Digido regarding these operations.
In its defense, Digido claimed that the four locations were merely temporary exhibit booths designed for marketing purposes and not permanent branches due to their limited operational scale and the short duration for which they were established.
However, the SEC countered this argument, noting that the company utilized social media to promote loan services that could be processed within 10 minutes at these booths.
The SEC indicated that this advertising activity suggested that the company intended to operate these booths as functioning branches, and therefore, the assertion of them being non-permanent and small did not exempt the company from regulatory compliance.
The revocation of Digido's financing license underscores the regulatory framework designed to ensure proper operation within the financial sector, emphasizing the importance of adherence to established guidelines and the need for prior authorization before commencing any branch operations.
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