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RBI Looking To Set Up An Agency To Curb Illegal Lending Apps

Inc42 · 1y ago

RBI Looking To Set Up An Agency To Curb Illegal Lending Apps

The Reserve Bank of India (RBI) is considering establishing a public register of whitelisted lending apps to crack down on illegal lending platforms in the country. In response to multiple deaths by suicide linked to predatory practices by digital lenders, the RBI plans to create the Digital India Trust Agency (DIGITA) to issue 'verified' signatures for authorized entities. Lending apps without this verification would be deemed unauthorized and face strict action. The RBI has taken steps in the past to regulate online lending platforms, such as directing Google to implement stricter norms and removing fraudulent lending apps from its Play Store. Despite efforts to curb these platforms, the Indian lendingtech market is projected to become a $1.3 trillion opportunity by 2030.

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Finance Minister Holds Top-Level Meet To Cull Illicit Spread Of Digital Lending Apps

Inc42 · 1y ago

Finance Minister Holds Top-Level Meet To Cull Illicit Spread Of Digital Lending Apps

During the 28th Financial Stability and Development Council (FSDC) meeting, chaired by Finance Minister Nirmala Sitharaman, the government discussed the issue of unauthorised lending through online apps and measures to curb its spread. The meeting included key decision-makers such as RBI Governor Shaktikanta Das and SEBI's chairperson Madhabi Puri Buch. The finance minister emphasized the need to increase vigilance in containing the spread of unauthorised online lending apps, highlighting concerns about the unregulated spread of digital lending in the country. This comes after the government directed Google to implement stricter norms in checking the spread of fraudulent lending apps. Despite efforts, illegal lending apps still pose a security risk in India's growing digital lending ecosystem.

Most Indian Consumers Still Susceptible To Illegal Loan Apps

Inc42 · 1y ago

Most Indian Consumers Still Susceptible To Illegal Loan Apps

A recent study conducted by the Fintech Association for Consumer Empowerment (FACE) reveals that nearly one-third of high-confidence customers in India lack knowledge about digital loans and struggle to detect illegal lending apps. The study found that many customers are unaware of key information such as the lender's name, key fact statements, and grievance redressal mechanisms. Over half of the respondents show limited knowledge of the verification factors for loan apps and are susceptible to fraud and scams. The report recommends addressing these gaps to protect customers and maintain trust in digital lending. Additionally, the Reserve Bank of India (RBI) is planning to establish a public register of whitelisted lending apps to combat illegal lending practices.

We have asked Google, Apple not to onboard illegal, unsafe apps: Rajeev Chandrasekhar

IndianStartupNews

IndianStartupNews · 1y ago

We have asked Google, Apple not to onboard illegal, unsafe apps: Rajeev Chandrasekhar

The Indian government has issued an advisory to technology giants Apple and Google, urging them not to onboard unsafe and illegal lending applications on their app stores. The move comes in response to rising reports of harassment by lending apps towards their customers for loan repayments. The government aims to make the internet safer by working with the Reserve Bank of India (RBI) to whitelist permitted loan applications and ensure transparency in the app stores. Google has already taken action by removing over 3,500 personal loan apps that violated policy guidelines.

ED takes action against illegal online gambling

Startup News FYI

Startup News FYI · 1y ago

ED takes action against illegal online gambling

The Enforcement Directorate (ED) has seized INR 5.87 crore from various individuals and entities under the Prevention of Money Laundering Act as part of its ongoing effort to combat illegal online gambling platforms. The investigation, stemming from a complaint filed by the Directorate General of Goods and Services Tax Intelligence, revealed a scheme orchestrated by Shyamala N and Umar Farooq. They registered multiple companies using forged documents and set up a network of 14 entities to deceive the public into online gambling. Indian authorities have taken comprehensive measures to curb illegal online gambling, including banning offshore platforms and blocking apps connected to China.

Centre’s Probe Against Chinese Entities Linked To Loan Apps In Final Stages

Inc42 · 1y ago

Centre’s Probe Against Chinese Entities Linked To Loan Apps In Final Stages

The Ministry of Corporate Affairs in India is conducting investigations into Chinese loan apps for alleged violations. Some cases are being probed by the Serious Fraud Investigation Office. The government aims to crack down on the operations of illegal Chinese loan apps by cancelling registration and freezing accounts if fraud is found. This investigation follows the Enforcement Directorate's search of office premises linked to Chinese entities involved in unauthorized lending apps. Despite concerns about predatory lending practices, these illegal entities continue to operate in India's digital lending space.

RBI To Set Up Public Repository Of Digital Lending Apps

Inc42 · 1y ago

RBI To Set Up Public Repository Of Digital Lending Apps

RBI Governor, Shaktikanta Das, has announced the establishment of a centralized database for approved lending platforms. This database will contain information from RBI-regulated financial institutions regarding their digital lending applications. The purpose of this initiative is to empower consumers by providing them with tools to differentiate between legitimate and potentially risky lending apps.

RBI orders Bajaj Finance to stop lending via ‘eCOM’ and ‘Insta EMI Card’

Livemint

Livemint · 1y ago

RBI orders Bajaj Finance to stop lending via ‘eCOM’ and ‘Insta EMI Card’

The Reserve Bank of India (RBI) has instructed Bajaj Finance to cease disbursing loans through its eCOM and Insta EMI Card products immediately. The directive was issued as Bajaj Finance was found to be non-compliant with RBI's digital lending guidelines, including the failure to provide Key Fact Statements to borrowers. The restriction on these products will be lifted upon rectification of the identified deficiencies. RBI had introduced the guidelines to curb fraudulent activities and protect borrowers in the digital lending sector.

RBI To Roll Out Unified Lending Interface To Offer Credit To Agricultural & MSME Borrowers

Inc42 · 11m ago

RBI To Roll Out Unified Lending Interface To Offer Credit To Agricultural & MSME Borrowers

The RBI is set to launch the 'Unified Lending Interface (ULI)' across India to address the credit needs of sectors such as agriculture and MSMEs. The ULI, which was tested last year, aims to speed up credit appraisal and enable the digital exchange of information. RBI Governor Shaktikanta Das believes that ULI has the potential to transform lending in India, similar to how the Unified Payments Interface (UPI) revolutionized the payment ecosystem.

Google removes over 2,200 fake loan apps from play store: MoS Finance

Inc42 · 1y ago

Google removes over 2,200 fake loan apps from play store: MoS Finance

Google has removed more than 2,200 fraudulent loan apps from its Play Store between September 2022 and August 2023, as part of the government's efforts to combat fake loan apps and protect consumers from financial scams. The government has been working with regulators to control illegal loan apps, and Google has updated its policies to only allow regulated entities or those working with them to publish loan apps on the Play Store. The Reserve Bank of India has also issued regulatory guidelines for digital lending to enhance customer protection and make the digital lending ecosystem safer.

New RBI co-lending rulebook tightens risk-sharing, reporting for co-lending, scraps double KYC

YourStory

YourStory · 2d ago

New RBI co-lending rulebook tightens risk-sharing, reporting for co-lending, scraps double KYC

The Reserve Bank of India (RBI) has introduced new standalone directions for co-lending, effective January 1, 2026. The guidelines apply to commercial banks and NBFCs, excluding specific small-scale banks, emphasizing risk-sharing and consumer safeguards. Key changes include eliminating double KYC checks and requiring entities to report their loan exposures individually. The rules aim to curb credit risk offloading and enhance transparency, with mandatory reporting and borrower protection measures to standardize co-lending practices.

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