The Reserve Bank of India (RBI) has introduced a comprehensive new framework for digital lenders, mandating enhanced data security and transparent interest rate disclosures to combat rising fraud.
3 months
Compliance Period
The RBI today released stringent new guidelines aimed at curbing digital lending fraud and promoting responsible lending practices. The framework requires digital lenders, including those operating through mobile apps, to implement enhanced data security measures, provide clear and transparent disclosure of all fees and interest rates, and establish a robust grievance redressal mechanism. This move comes amidst a surge in complaints regarding predatory lending practices and data misuse in the rapidly growing digital lending space. The new rules cover all entities regulated by the RBI as well as their un-regulated partners.
💭 If you're wondering…
It applies to apps facilitating loans from RBI-regulated entities (banks, NBFCs). If an app is lending from its own unregulated funds without partnering with a regulated entity, its legality is questionable, and it's outside this specific framework.
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