Rules Related To Digital Loans To Protect Customers - RBI Deputy Governor
The Reserve Bank, after extensive consultations with the industry, has issued rules related to digital loans on August 10 and has asked the industry to implement it by November this year. Giving information on Thursday, Reserve Bank of India (RBI) Deputy Governor M Rajeshwar Rao said that the recently issued rules related to digital loans have been made to eliminate arbitrage and protect customers.
Rajeswara Rao said at an event organized by industry body Assocham that the RBI has framed rules related to digital loans due to unbridled third party involvement, deceptive selling, data privacy violations, unethical recovery practices and exorbitant interest rates. The central bank after extensive consultations on August 10 issued the rules related to digital loans and asked the industry to implement them by November this year. Whereas after the release of these rules, some companies in the fintech industry have expressed concern that it will affect their operations.
Rajeswara Rao further said, “The digital tax structure has been designed to strike a balance between the need for an innovative and inclusive system. At the same time, it has been ensured that the interests of the customers are protected. He said that these norms are solely for those regulated entities who lend through the app.