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RBI Gov clarifies on digital lending apps

Central bank will only act against entities registered with it, says RBI

RBI Governor Shaktikanta Das
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Reserve Bank of India Governor Shaktikanta Das

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Mumbai: Customers borrowing from unregistered digital lending apps should approach the local police in case of any issue, Reserve Bank Governor Shaktikanta Das said on Wednesday, making it clear that the central bank will only act against entities registered with it.

In remarks that came in the wake of a spate of alleged suicides abetted by harassment by agents or officials of lending apps, Das said most of the digital lending apps are not registered with the central bank and operate by themselves. Das said whenever it gets a complaint from any customer, the central bank directs customers of such unregistered apps to approach the local police, which will conduct an investigation and take necessary action on the issue.

The RBI website has a list of apps that are registered with it on the website, the governor said, adding that the police in many states have acted against the wrongdoers as per the provisions of the law. It can be noted that a spate of alleged suicides in the recent past have been attributed to harassment by loan recovery agents working for or on behalf of digital lending apps. At the time of borrowing, a borrower consents to share personal information like the contact book of the telephone, which leads to a situation where the borrower is defamed before a person known to her or him, leading to extreme steps. "It's my humble request to all those using such apps to first check if the app is RBI registered or not. If the app is RBI registered, the central bank will act immediately in case of any misdoing, I assure you," Das said in the customary post-policy press interaction.

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