365Telugu.com Online news, Hyderabad,February16th,2023: The Reserve Bank of India (RBI) has introduced new guidelines for borrowers availing loans through loan apps.
Harassment of agents will be curbed under these regulations. RBI said customers must provide information before a recovery agent contacts them.
RBI has asked digital lenders to provide details of recovery agents to borrowers
- In the FAQ on digital lending guidelines, RBI said that details of the recovery agent must be communicated to the borrower before the agent contacts the borrower.
- RBI said physical loan collection through online platforms should be done only where ‘absolutely necessary’ through cash.
-Payment aggregators who also act as lending service providers will have to comply with digital lending guidelines, RBI said.
The Reserve Bank of India (RBI) has issued new rules in the format of frequently asked questions amid customer complaints against app-based lending institutions.
Answers to 18 questions have come out. It said that in case the customer defaults in repayment of the loan, the customers have to provide the necessary information about the agent in advance through SMS or email.
Also, now the company has to provide necessary information about the agent at the time of granting loan to the customer. Due to these RBI guidelines, borrowers will no longer be harassed by agents.
The RBI said it is mandatory for the customer to provide this information before the recovery agent contacts him. According to the new rule, all loan payments must be made between the borrower’s bank account transactions only with a bank or a non-banking financial company.
RBI has disclosed that the transaction shall not involve any other account with the service provider or any third party.
RBI has said that customers paying installments through credit cards will not come under this provision. It said that there are already various terms and conditions for that. Payment aggregators acting as lenders (LSPs) can be used to disburse the loan.