On August 10th, RBI issued a press release highlighting the Working Group (WG) recommendations to be followed by Regulated Entities (REs), Digital Lending Applications (DLAs), and Lending Service Providers (LSPs).
The WG was set up by RBI to study the digital lending landscape in India. Based on the results of the study, WG released suggestions that focused on customer protection, technological requirements, and regulatory framework.
Loan disbursals and repayments should be between the borrower’s bank account and the lenders without any third-party pool account involvement.
REs must directly pay the fees and charges to LSPs and not charge the borrower
Before signing the loan contract, the borrower must be given a Key Fact Statement (KFS)
A change in credit limit should be based on the borrower’s prior consent
Borrowers can exit digital loans during the cooling-off period
Borrower complaints should be resolved by a nodal grievance redressal officer in 30 days
Only essential data should be collected from the borrower with explicit consent
All lending activities must be reported to Credit Information Companies (CICs)
Apart from these recommendations, there are a few more things that are under examination.
Watch this space for more!
Growth of digital lending industry in India
Credit Underwriting - How Alternative Data Sources Help
Pros and Cons of Payroll Cards
Anatomy of Payment Card Transactionsin Ecommerce
RBI has taken steps to promote rupee as the preferred currency for global trade
Easebuzz gets in-principle approval from RBI for Payment Aggregation Authorization
Mumbai to play host to the world's largest fintech conference, Global Fintech Fest
Wealthtech startup Dezerv has secured $21 Mn in Series A funding round led by Accel
ONDC inks MoU with SIDBI to onboard small businesses to its network
We're stoked to announce our collaboration with IndusInd Bank. As the first of its kind in India, the bank will use our analytics-backed technology to provide hyper-personalized services across payment and lending verticals. Know more.
People First HR Excellence Awards has recognized M2P Fintech as a winner in the category of 'Lending Practices in Diversity & Inclusion Initiatives,' and Clement D., Head of the People Success Team, has bagged the prestigious 'CHRO of the Year' award!
Madhusudanan R, our co-founder and Vaanathi Mohanakrishnan, Business Head – MENA attended the Fintech Saudi Accelerators Demo Day. They participated in the graduation ceremony alongside 12 brilliant start-ups. Catch its glimpse here.
That's it for now. See you again soon with all the need-to-know fintech updates!
Stay tuned. Stay curious.
It costs nothing to stay on top of all things fintech.
