RBI forms working group to regulate digital lending through loan apps
The Reserve Bank of India has set up a working group to regulate digital lending through mobile applications amid growing concerns surrounding the unsupervised growth of loan platforms across the country. “Recent spurt and popularity of online lending platforms/ mobile lending apps (‘digital lending’) has raised certain serious concerns which have wider systemic implications,” the central bank said in a statement. “Against this backdrop, a Working Group (WG) is being set up to study all aspects of digital lending activities in the regulated financial sector as well as by unregulated players so that an appropriate regulatory approach can be put in place,” it added. The move comes amid a growing outcry in the public surrounding reports of unethical collection practices, high interest rates and, the fraud and data risks surrounding the use of loan apps across India.