RBI wants IT ministry to ensure only regulated digital lenders on app stores: FinMin

The Reserve Bank of India (RBI) has furnished the list of Digital Lending Apps (DLAs) being used by Regulated Entities (REs) to the Ministry of Electronics & Information Technology (MeitY), which in turn, has shared the list with respective intermediaries (app stores) and requested them to ensure that only the apps figuring in the list are hosted on their app stores, the finance ministry said in the Parliament on February 7.

This comes after the MeitY issued an order to block a host of loan and betting apps with alleged Chinese links. Moneycontrol earlier accessed a list of 58 such apps and reported that Google was reviewing the government order to implement on its app store.

The finance ministry said in the Parliament that the central bank has also issued a master circular, under which banks and financial institutions have been advised to follow certain customer identification procedures for opening of accounts and monitoring transactions of suspicious nature to avoid its misuse for money laundering.

Further, the RBI has issued digital lending guidelines in September 2022, which advises measures including due diligence of loan service providers (LSPs), direct disbursal of loan from bank account of lender to bank account of the borrower without any pass-through/pool or third-party account to avoid layering, publishing of the list of DLAs and LSPs engaged by REs and details of activities to avoid anonymity.