New Delhi: No less than 600 “illegal loan applications” are present in several application stores for Android users in India, found a panel of the Reserve Bank of India (RBI). A total of about 1,100 unique Indian loan applications containing the keywords like loan, instant loan, fast loan etc. are available in the application stores. In an effort to prevent illegal digital lending activities, RBI proposed to the Indian government to formulate new legislation. The details were mentioned in an RBI task force report on digital lending, including lending through online platforms and mobile apps.
“According to the findings of the task force, there were around 1,100 loaner apps available to Indian Android users in more than 80 app stores (January 1, 2021 to February 28, 2021),” the RBI report states. .
“No. of App Stores in which Indian loan applications are available ~ 81. Number of unique Indian loan applications containing keywords: loan, instant loan, fast loan, etc. ~ 1,100. Number of applications ~ 600 illegal loans, ”the RBI report states.
Approximately 2,562 complaints were received from January 2020 to March 2021 against digital lending applications. The maximum number of complaints was received in Maharashtra, followed by Karnataka, Delhi, Haryana, Telangana, Andhra Pradesh, Uttar Pradesh, West Bengal, Tamil Nadu and Gujarat, according to the RBI report.
The majority of complaints relate to loan applications promoted by entities not regulated by the Reserve Bank, such as companies other than NBFCs, unincorporated entities and individuals. Another significant number of complaints relate to loan applications partnered with NBFCs, particularly the smaller NBFCs (asset size less than Rs 1000 crore), according to the RBI report.
RBI had formed a working group (WG) on digital lending, including lending through online platforms and mobile apps, on January 13, 2021. The working group was set up against the backdrop of the conduct issues business and customer protection arising from the surge in digital lending business. . The WG has since submitted its report. The aim of the report has been to improve customer protection and make the digital lending ecosystem safe and healthy while encouraging innovation, the RBI said.