Beware of illegal digital lending apps: RBI
Advisory in the backdrop of suicides in Telangana
Hyderabad: The Reserve Bank of India has advised public to be wary of unauthorised digital lending platforms and mobile apps.
Taking note of reports about individuals and small businesses falling prey to a growing number of unauthorised digital lending platforms/mobile apps, the central bank on Wednesday said “members of public are cautioned not to fall prey to such unscrupulous activities.” It urged them to verify antecedents of the company/ firm offering loans online or through mobile apps.
The advisory comes in the backdrop of at least three borrowers in Telangana committing suicide in the recent past, following alleged harassment by personnel of such lenders, and many more complaining of being subjected to coercive methods after defaulting on repayments.
The RBI said the reports cited the excessive rates of interest and additional hidden charges demanded from borrowers; adoption of unacceptable and high-handed recovery methods; and misuse of agreements to access data on the mobile phones of the borrowers. They also pointed to how unauthorised digital lending platforms/mobile apps attracted borrowers with promise of loans in a quick and hassle-free manner.
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The Hindu, 23 December, 2020, https://www.thehindu.com/news/national/be-wary-of-unauthorised-digital-lending-platforms-apps-rbi/article33404023.ece?homepage=true