In a clampdown on illegal digital loan apps that offer loans, especially to vulnerable people at exorbitantly high-interest rates, the government Friday asked the Reserve Bank of India to prepare a list of all legal lending Apps and ensured only such apps would indulge in the lending business in future.
The RBI will prepare a “Whitelist” of all legal apps and Meity will ensure only these “Whitelist” apps are hosted on app stores. The decision was taken at a meeting chaired by Finance Minister Nirmala Sitharaman on how illegal loan apps outside the banking channel have been cheating low-income group people by charging an exorbitantly high-interest rate.
It was decided that the RBI will monitor the mule/rented accounts that may be used for money laundering and review/cancel dormant shadow banks to avoid their misuse.
The RBI will also ensure that the registration of payment aggregators is completed within the timeframe and no unregistered payment aggregator be allowed to function after that.
Ministry of Corporate Affairs will identify shell companies and de-register them to prevent their misuse. Steps will be taken to increase cyber awareness for customers, bank employees, law enforcement agencies and other stakeholders.
The Ministry of Finance will monitor compliance on a regular basis.
The move has been taken after RBI received a number of complaints of illegal apps cheating people.
An RBI working group on digital lending, earlier this year, had identified around 600 illegal lending apps. The central also received over 2,500 complaints against digital lending apps between the start of January 2020 to the end of March 2021.
In the wake of a growing number of complaints against such apps, RBI Governor Shaktikanta Das to has urged the general public to do due diligence before availing service from those apps.
(Published 09 September 2022, 14:28 IST)
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