NEARLY HALF of nonbank financial institutions (NBFIs) were evaluated as “cautious practitioners” of green finance, the Securities and Exchange Commission (SEC) said.
NBFIs classified as such have made moderate progress in green finance integration but remain risk-averse and selective in scaling their commitments.
To address this, a panel convened during the SEC’s Sustainability Week pointed to the need for unlocking investment in nature-based solutions and the transition of NBFIs toward more proactive, sustainable finance practices.
The SEC is pressing for the integration of sustainability in the financial system, steering companies into adopting sustainable practices.
SEC Commissioner McJill Bryant T. Fernandez said NBFIs play an important role in enabling economic transformation.
“As financial intermediaries and facilitators of investment flows, NBFIs are uniquely positioned to catalyze change — not just in markets, but in the communities and ecosystems that need it most,” he said.
SEC Chairman Francis Ed. Lim said sustainability must be a core principle in the financial system, through the observance of the Philippine Sustainable Finance Taxonomy Guidelines (SFTG).
“The real value of the Philippine SFTG lies in how well we apply it — in structuring financial products, shaping disclosures, guiding investment decisions, and delivering real-world impact,” Mr. Lim said in a statement on Monday.
Issued in February last year, the SFTG provides a framework for evaluating the environmental and social sustainability of economic activities. It also presents a “simplified approach” to assessing micro, small, and medium enterprises for financing.
Sustainability Week featured a training session on the SFTG, and capacity-building session on sustainable investments for NBFIs.
Separately, the SEC issued cease-and-desist orders against Bravo Zulo Romeo Lending Corp. (BZR Lending) for operating an unauthorized lending business, and Magic Peso for illegally operating an online lending platform (OLP) and unfair debt collection practices.
The SEC Financing and Lending Companies department found that the Magic Peso OLP is owned and operated by BZR Lending. The cease-and-desist orders were issued after complaints from borrowers regarding Magic Peso’s alleged unfair collection processes.
BZR Lending also failed to file a disclosure regarding any OLP operations despite being registered with the SEC as a lending company, the regulator said.
SEC Memorandum Circular (MC) No. 19 issued in 2019 requires the full disclosure and reporting requirements for financing and lending companies using OLPs. It also requires OLPs to disclose information such as their corporate name, SEC registration number, and certificate of authority to operate in a portion of their platforms.
Magic Peso’s operations also violate the moratorium imposed on new OLPs in November 2021 as outlined in SEC MC No. 10. — Revin Mikhael D. Ochave