Government Receives Whitelist of Loan Apps from RBI Governor Shaktikanta Das, Non-Compliant Apps to Face Repercussions

RBI Shares Whitelist of Loan Apps

Reserve Bank of India (RBI) Governor Shaktikanta Das announced that the central bank has shared a whitelist of lending apps with the Centre. The list was compiled from loan apps used by regulated entities such as banks and non-banking financial companies (NBFCs).

Action Against Illegal Loan Apps

The Union IT Ministry is expected to take action against illegal loan apps that are not included in the whitelist. This move is aimed at curbing the rapid growth of fraudulent firms in the digital lending market.

The Impact of Illegal Loan Apps

The illegal lending market is estimated to be at least $700-800 million. There have been around a dozen cases reported since 2020 where individuals caught in the trap of illegal loan apps had allegedly died by suicide.

RBI and Government Collaboration

The RBI and the government are actively engaged in coordination meetings to take appropriate measures against illegal lending apps. The RBI’s submission of a whitelist to the government followed a high-level meeting chaired by Finance Minister Nirmala Sitharaman in September 2022.

Future Measures

The IT Ministry, prompted by an investigation, directed social media platforms to take “additional measures” to ensure that they don’t host advertisements of fraudulent loan apps. The consequences of hosting such advertisements will be the “sole responsibility” of such intermediaries/platforms.