RBI will soon regulate digital lending platforms to crack down on many ‘unauthorized and illegal’ apps: RBI Governor
RBI governor suggests customers borrowing from unregistered digital lending apps should contact local police in case of any issues
RBI governor suggests customers borrowing from unregistered digital lending apps should contact local police in case of any issues
The Reserve Bank of India (RBI) will soon come up with a regulatory architecture for digital lending platforms, many of which are unauthorized and illegal, Governor Shaktikanta Das said on June 9.
There are increasing cases of borrowers allegedly committing suicide due to harassment at the hands of some platform operators.
“I think very soon we will come out with a comprehensive regulatory framework that should be able to address the challenges that we are facing… with respect to lending through digital platforms, many of which Unauthorized, unregistered and what should I call, illegal,” said Mr Das while delivering a lecture on ‘Indian Business (Past, Present and Future)’.
He was speaking at the prestigious week of celebrations organized by the Central Board of Indirect Taxes and Customs (CBIC) as part of the ‘Azadi Ka Amrit Mahotsav’ to mark the 75th anniversary of India’s independence.
Mr Das suggested on June 8 that customers borrowing from unregistered digital lending apps should approach the local police in case of any issues.
He told reporters after the monetary policy announcement that most of the digital lending apps are not registered with the central bank and are self-operated.
The RBI governor said whenever it receives a complaint from a customer, the central bank directs customers of such unregistered apps to approach the local police, which will investigate and take necessary action.
“My humble request to all the people using such app is to first check whether the app is RBI registered or not. If the app is RBI registered, the central bank will take immediate action in case of any wrongdoing, I assure you,” Mr Das said.
The governor said on June 9 that the RBI recognizes the role of existing and emerging businesses for economic growth.
He said that the long-term success of any business is directly related to the quality of its governance, the strength of its internal control system and its risk appetite and organizational culture.
Mr Das said that the central bank is emphasizing on improving the governance and compliance culture of its regulated entities such as banks, NBFCs and other financial institutions through a number of measures.