The Reserve Bank of India has reached out to Google, the Digital Lenders Association (DLAI), fintech association FACE and several non-bank lenders for inputs on ways to regulate digital lenders. RBI’s working group on digital lending has sought details from Google on its criteria for onboarding fintech loan apps on its play store platform and the parameters that these digital lenders follow.
Google’s recent review exercise on online loan apps helped the banking regulator in removing more than 400 such apps in January deemed to be in violation of its policy. Many of these apps were backed by Chinese entities and flagged by regulatory authorities and state police departments for unlawful lending practices. An official said “The RBI working group has been seeking lot of suggestions from industry groups, Google and lenders engaged in business with digital lenders to put in place elaborate regulations for these platforms.”
“There is a unanimous effort from all stakeholders from RBI regulate all forms of digital lending, even for those that are currently outside the purview of the regulator,” he added. Digital lenders have recommended that all credit products should be guided by common standards, so that loopholes exploited in deferred payment options schemes are done away with. The lenders have also suggested an upfront disclosure of all charges payable including annual charges on interest rates, to ensure that customers don’t feel cheated.
