India’s RBI Tightens Rules on Digital Lending After Complaints
- Apps offering quick, small-ticket loans boomed during pandemic
- Activists have linked a host of suicides to recovery tactics
The Reserve Bank of India headquarters in New Delhi.
Photographer: T. Narayan/BloombergThis article is for subscribers only.
India’s central bank released guidelines for digital lending, targeted at bringing transparency and data protection to the business after complaints started mounting over unfair recovery practices, with many players capitalizing on borrowers’ lack of financial literacy.
The Reserve Bank of India released the guidelines Wednesday, which direct operators to display all inclusive costs of the digital loan as an annual percentage rate upfront and bring periodic review of the conduct of lending service providers engaging in recovery.