The Reserve Bank of India has announced measures to curb unauthorised lending apps and protect consumers from such illegal activities. RBI governor Shaktikanta Das has proposed creating a public repository of digital lending apps (DLAs) to check such practices.
Governor Das said, “The Reserve Bank proposes to create a public repository of DLAs deployed by its regulated bodies. The regulated bodies (REs) will report and update information about their DLAs in this repository. This measure will help consumers identify unauthorised lending apps.”
Das said the move will help in efforts to establish a strong digital lending ecosystem in the country. “The Reserve Bank has taken several measures for the orderly growth of the digital lending ecosystem in India. As a further measure in this direction, and to address the issues arising from unauthorized digital lending apps,” the RBI governor said.
RBI regulated entities will have to submit updated information about their digital lending apps to the repository. The creation of the depository will help consumers identify unauthorized lending apps. Unauthorized lending apps are mobile apps that impersonate real lenders and steal personal and financial information. Last year, the government had made ‘urgent’ and ’emergency’ loans mandatory for users of digital lending apps.Dhar had banned 138 betting apps and 94 lending apps with Chinese links.
Other new initiatives announced in the monetary policy include increasing the limit for tax payment through UPI from Rs 1 lakh to Rs 5 lakh per transaction. This will further facilitate tax payment by consumers through UPI.
RBI has also introduced the facility of “delegated payments” in UPI. This will allow one person (primary user) to allow another person (secondary user) to carry out UPI transactions up to a limit from the primary user’s bank account, without the secondary user needing to have a separate bank account linked to UPI. This will further deepen the reach and usage of digital payments. In another big announcement for the convenience of MSMEs and small merchants, RBI has announced that now cheques will be settled on a real-time basis, i.e. within a few hours of presentation, earlier it used to take two days.
“Currently, cheque clearing through cheque truncation system operates in batch processing mode and has a clearing cycle of up to two working days. It is proposed to reduce the clearing cycle by introducing continuous clearing with ‘on-realisation-settlement’ in CTS. This means that clearing will take place within a few hours on the day of cheque presentation. This will expedite cheque payments and benefit both the payer and the payee.” RBI has also increased the frequency of reporting by credit information companies. Currently lenders have to provide credit information to companies every month or at shorter intervals as agreed, now they will have to provide this information every fortnight.
Governor Das said, “It is proposed to increase the frequency of reporting of credit information to a fortnightly basis or at shorter intervals. As a result, borrowers will benefit from faster updating of their credit information, especially when they repay their loans. Lenders, on their part, will be able to do better risk assessment of borrowers.”
