RBI Governor Shaktikanta Das Announces Measures to Tackle Unauthorized Lending Apps and Enhance Digital Payments
The Reserve Bank of India (RBI) has introduced new measures to combat unauthorized lending apps and improve the digital lending ecosystem. RBI Governor Shaktikanta Das announced the creation of a public repository of digital lending apps (DLAs) to help consumers identify unauthorized apps.
Governor Das stated, “The Reserve Bank proposes to create a public repository of DLAs deployed by its regulated entities. The regulated entities (REs) will report and update information about their DLAs in this repository. This measure will help the consumers to identify the unauthorized lending apps.”
Unauthorized lending apps impersonate real lenders and steal personal and financial information. Last year, the government banned 138 betting apps and 94 loan lending apps with Chinese links.
Other initiatives include increasing the limit for tax payments through UPI from Rs 1 lakh to Rs 5 lakh per transaction, introducing ‘Delegated Payments’ in UPI, real-time cheque clearing, and more frequent credit information reporting.
Governor Das explained, “At present, cheque clearing through the Cheque Truncation System (CTS) operates in a batch processing mode and has a clearing cycle of up to two working days. It is proposed to reduce the clearing cycle by introducing continuous clearing with ‘on-realisation-settlement’ in CTS. This means that cheques will be cleared within a few hours on the day of the presentation. This will speed up cheque payments and benefit both the payer and the payee.”
The RBI has also increased the frequency of reporting by credit information companies to a fortnightly basis, benefiting borrowers with faster updates of their credit information and allowing lenders to make better risk assessments.
Doubts Revealed
RBI -: RBI stands for the Reserve Bank of India. It is the central bank of India, which means it manages the country’s money and banking system.
Governor Shaktikanta Das -: Shaktikanta Das is the person who is currently in charge of the Reserve Bank of India. He makes important decisions about how money and banks should work in India.
Unauthorized lending apps -: These are apps that give loans to people without following the rules. They can be dangerous because they might cheat people or charge very high interest rates.
Digital payments -: Digital payments are ways to pay for things using your phone or computer instead of cash. Examples include using apps like Paytm or Google Pay.
UPI -: UPI stands for Unified Payments Interface. It is a system in India that allows you to transfer money between bank accounts using your phone.
Public repository -: A public repository is a place where information is stored and can be accessed by everyone. In this case, it will list all the digital lending apps that are safe to use.
Real-time cheque clearing -: This means that when you deposit a cheque, the money will be available in your account almost immediately, instead of waiting for a few days.
Credit information reporting -: This is when banks and other lenders share information about how well you repay loans. It helps them decide if they should give you a loan in the future.
