The banking regulator’s new digital lending guidelines has shown some positive impact. The number of complaints from victims of fraudulent apps has declined after the guidelines were released earlier this month, according to the people who work in the customer protection space, reported The Economic Times.
Under the new rules, regulated entities (REs) are required to disclose all costs upfront in a digital loan product to customers and are not allowed to scrub or read borrowers’ smartphones.
For fraudulent loan apps, this has been the general mode of operation. These apps often gain access to a borrower’s data from their phones and subsequently blackmail or harass the borrower into repaying the loan amount and also charge exorbitant interest rates on the loan.
As per data from the SaveThem India Foundation, a non-profit organisation that assists victims of cybercrimes, the number of complaints on digital lending applications (DLA) and bank recovery has reduced significantly.
“From August 11, when the RBI put out the guidelines, till August 23, we have seen the number of distress and complaint calls on our helpline go down from a little over 200 to less than 100 a day,” Pravin Kalaiselvan, the director of the foundation, said. “This comes after we saw a big spike from the beginning of 2022 where we have had over 5,500 complaints filed via our Google Forms alone.”
Survey firm Local Circles said the number of complaints had reduced by 30-40 percent in the past four weeks. It based the finding on preliminary disaggregated data in the form of posts and comments.