ALERT: RBI warns of unauthorized digital lenders and mobile apps

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New Delhi: In a crucial development, the Reserve Bank of India (RBI) on Wednesday issued a warning against individuals and small businesses falling victim to a growing number of digital lending platforms and non-mobile apps. authorized by promising loans in a quick and hassle-free manner.Also Read – Good News for Homebuyers: Kotak Mahindra Bank Cuts Mortgage Interest Rates to 6.5% | Here’s how to apply

In issuing the warning, the RBI said these bogus lending platforms charge excessive interest rates and additional hidden fees, adopt unacceptable and overbearing recovery methods and abusive agreements to access data on phones. laptops of borrowers. Also Read – RBI Likely To Launch First Digital Currency Trials By December, Shaktikanta Das Makes Big Announcement

“Members of the public are hereby cautioned not to fall prey to such unscrupulous activity and to check the background of the company / business offering loans online or through mobile apps,” the central bank said in a statement. communicated. Also Read – RBI Partially Lifts Tech Ban on HDFC Bank, Allows It To Issue New Credit Cards

The RBI also said consumers should never share copies of Know Your Customer (KYC) documents with unidentified persons, unverified / unauthorized applications and should report such incidents to relevant law enforcement agencies. .

However, he said legitimate public lending activities can be undertaken by banks, non-bank financial corporations (NBFCs) registered with the RBI and other entities regulated by state governments under statutory provisions.

The RBI said it has demanded that digital lending platforms used on behalf of banks and NBFCs disclose the name of the bank (s) or NBFCs to customers upfront. He also said that the names and addresses of NBFCs registered with the Reserve Bank can be viewed and the portal for filing complaints against RBI Regulated Entities is accessible via https://cms.rbi.org.in .

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