Instant loans on mobile apps can be costly, RBI alerts
The Reserve Bank of India (RBI) has asked people to be cautious about offering loans through digital lending platforms and mobile apps in an unauthorized manner. RBI said in a release on Wednesday that there are reports that people/small businessmen are getting caught in the flurry of unauthorized digital platforms and apps promising to give loans quickly and without any hassle.
According to the release, the report also asked for a higher interest rate and additional back door costs. At the same time, they are adopting such stringent methods of recovery which are unacceptable and are misusing the access to data on the mobile phones of the borrowers. The RBI said, “People are advised to be vigilant about such deceptive activities and to thoroughly investigate the company/entity offering loans through digital and mobile apps.”
Do not share KYC copy
The central bank has also asked customers not to share copies of KYC (known to their customers) to unknown people or unauthorized apps. The bank says to inform the concerned legal authority about the bank account information associated with this type of app or app. Apart from this, online complaints about such apps, a digital platform can be made at https:achet.rbi.org.in. Banking and non-banking financial companies (NBFCs), which are registered with the RBI, can be legally lent. Also, units that are regulated by the State Governments under statutory provisions can undertake lending.
The Reserve Bank has also arranged that those operating the digital lending platform on behalf of banks and NBFCs will have to clearly name the financial institutions concerned to the customers. The names and addresses of registered NBFCs can be obtained from the RBI website.
