Empowering MSMEs with News & Insights

RBI Moots Digital India Trust Agency To Vet Digital Lending Platforms

Updated: Apr 03, 2024 04:17:03pm

RBI Moots Digital India Trust Agency To Vet Digital Lending Platforms

New Delhi, Apr 3 (KNN) The Reserve Bank of India (RBI) is considering establishing an official public register to whitelist legitimate lending applications operating in the country.

This measure aims to curb the growing instances of predatory and illegal digital lending platforms preying on unsuspecting borrowers, reported PTI.

As part of this initiative, the central banking authority is exploring the creation of a new regulatory body called the “Digital India Trust Agency” or DIGITA.

This agency would be tasked with vetting home-grown lending ecosystems and ensuring that only credible players are allowed to operate.

According to sources familiar with the matter, any lending app lacking DIGITA's verified digital signature would be deemed unauthorised, potentially attracting severe penalties from enforcement authorities.

This decisive action comes in the wake of a surge in tragic suicides linked to the corrupt practices employed by certain digital lenders. Many of these platforms have been accused of aggressively trapping naive borrowers into difficult loan terms with exorbitantly high interest rates.

When users struggle to repay, these lenders allegedly resort to predatory debt collection tactics, driving some to take their own lives in desperation.

With public safety being paramount, RBI is determined to restore order and accountability to the digital lending sphere. Stringent oversight through a whitelist of DIGITA-approved apps could be the much-needed solution to safeguard Indian citizens from unethical operators.

(KNN Bureau)


    Be first to give your comments.


Required fields are marked *