Governor Shaktikanta Das on Thursday said the Reserve Bank of India (RBI) will soon come out with a regulatory framework for digital lending platforms, many of which are unauthorized and illegal.
There are increasing cases of alleged suicides of borrowers due to harassment by some operators of digital lending apps.
“I think very soon we will come out with a comprehensive regulatory framework that should be able to address the challenges we face with respect to lending through digital platforms, many of which are unauthorized, unregistered and, I must say, illegal” said Mr. Das while delivering a lecture on Indian business (past, present and future).
He was speaking at the prestigious week celebrations as part of the ‘Azadi Ka Amrit Mahotsav’ organized by the Central Board of Indirect Taxes and Customs (CBIC) to mark the 75th anniversary of independence.
Mr Das on Wednesday suggested that customers borrowing from unregistered digital lending apps should approach the local police in case of any issues.
He told reporters after the monetary policy announcement on Wednesday that most of the digital lending apps are not registered with the central bank and are self-operated.
He said, “My humble request to all the people using such app is to first check whether the app is RBI registered or not. If the app is RBI registered, the central bank will take immediate action in case of any wrongdoing. Will do, I assure you.” Told.
The governor said on Thursday that the RBI recognizes the role of existing and emerging businesses for economic growth.
He said that the long-term success of any business is directly related to the quality of its governance, the strength of its internal control system and its risk appetite and organizational culture.
Mr Das informed that the central bank is emphasizing on improving the governance and compliance culture of its regulated entities such as banks, NBFCs and other financial institutions through several measures.