Disclaimer

This website is only for informational purposes. Visitors are requested to note that the information is intended to be correct, complete, and up-to-date. Juris Corp does not warrant that the information contained on this website is accurate or complete, and disclaims any and all liability to any person for any loss or damage caused by errors or omissions, whether such errors or omissions result from negligence, accident or any other cause.

This website is not intended to be a source of advertising or solicitation. The reader must not consider the information contained herein to be an invitation for a lawyer-client relationship, must not rely on information provided herein and must seek independent advice. Transmission, receipt or use of any information on this website does not constitute or create a lawyer-client relationship. No recipients of content from this website should act or refrain from acting, based upon any or all of the contents of this website.

Furthermore, Juris Corp does not wish to represent anyone desiring representation based solely upon viewing this web site. Finally, the reader is warned that the use of e-mail for confidential or sensitive information is susceptible to inherent risks of lack of confidentiality associated with sending e-mail over the internet.

By clicking on the "I understand and agree" button below, the user acknowledges that:

  • This website is not a mode of advertisement, promotion, personal communication, or solicitation of any sort whatsoever and the user wishes to gain information about us for his/her own reasons;
  • Entering into this website does not establish a lawyer-client relationship.

We are not liable for any consequence of any action taken by the user relying on information provided under this website. In cases where the user has any legal issues, he/she must seek independent legal advice.

JC - Legal Updates - Report on Digital Lending

Legal Updates

23 Nov 2021

Report on Digital Lending

Reserve Bank of India (“RBI”) has issued its working group report on digital lending including lending through online platforms and mobile apps last week. The thrust of the report has been on enhancing customer protection and making the digital lending ecosystem safe and sound while encouraging innovation.

Key Recommendations:

(a)   Subjecting the Digital Lending Apps to a verification process by a nodal agency to be setup in consultation with stakeholders.

(b)   Setting up of a Self-Regulatory Organisation (“SRO”) covering the participants in the digital lending ecosystem.

(c)   A separate legislation to prevent illegal digital lending activities.

(d)   Development of certain baseline technology standards and compliance with those standards as a pre-condition for offering digital lending solutions.

(e)   Data collection with prior and explicit consent of borrowers with verifiable audit trails.

(f)   All data to be stored in servers located in India.

(g)   Use of unsolicited commercial communications for digital loans to be governed by a Code of Conduct to be put in place by the proposed SRO.

(h)   Maintenance of a ‘negative list’ of Lending Service Providers by the proposed SRO.

(i)   Standardised Code of Conduct for recovery to be framed by the proposed SRO in consultation with RBI.

RBI has invited comments on the report from the stakeholders / public to be submitted by December 31, 2021.

Reserve Bank of India - Press Releases (rbi.org.in)

For any further information, please contact Mr. Ankit Sinha (ankit.sinha@jclex.com), Mr. Saurabh Sharma (saurabh.sharma@jclex.com), Ms. Rupul Jhanjee (rupul.jhanjee@jclex.com) or Ms. Teza Jose (teza.jose@jclex.com).