Regulatory framework, Digital Lending Apps (DLA) directory and cybercrime reporting mechanisms strengthen consumer protection in digital lending

Reserve Bank of India (RBI) had constituted a Working Group on Digital Lending including lending through Online Platforms and Mobile Apps. Based on its recommendations, RBI has issued regulatory guidelines on digital lending, which aims at firming up the regulatory framework for digital lending, including loans through mobile apps, while enhancing customer protection and making digital lending ecosystem safe and sound.

All the Regulated Entities (REs) are required to comply with the said guidelines on digital lending. Compliance to these guidelines are examined on sample basis during supervisory assessment and any non-compliance observed is taken up for rectification apart from initiating supervisory/ enforcement action, as deemed fit.

Ministry of Electronics and Information Technology (MeitY) issues directions for blocking of information, including fraudulent loan apps developed under Section 69A of Information Technology (IT) Act, 2000 after following the due process as provided in the Information Technology (Procedure and Safeguards for Blocking for Access of Information by Public) Rules, 2009.

Further, the Government and RBI have been taking up various initiatives from time to time to protect citizens from exploitation by unauthorized mobile loan apps. These inter-alia, include:

1. RBI has operationalized a directory ‘Digital Lending Apps (DLAs)’ on its website with effect from 01.07.2025, consisting of all DLAs deployed by REs of RBI. The directory aims to aid the customers in verifying the claim of a Digital Lending Apps (DLA’s) association with a RE.
2. Proactively engaging with the major internet intermediaries and messaging platforms to review the operations of unauthorised loan apps. Further, to disrupt the ecosystem of fraudulent digital loan apps, internet intermediaries have been instructed to institute stringent, technology driven vetting and real time enforcement mechanisms to detect and prevent malicious advertisement of illegal loan apps originating from offshore entities.
3. Indian Cyber Crime Coordination Centre (I4C), Ministry of Home Affairs (MHA) has been proactively analysing the digital lending apps. In order to facilitate the citizens to report cyber incidents including illegal loan apps, MHA has launched a National Cybercrime Reporting Portal (www.cybercrime.gov.in) as well as a National Cybercrime Helpline number “1930”.
4. The banks through the public facing platform ‘SACHET’ portal and the inter-regulatory State Level Coordination Committee (SLCC) facilitate the citizens for lodging of any complaints against specific entity related to deposit/ collection of money illegally.
5. RBI and banks have been taking up awareness campaigns through short SMS, radio campaign, publicity on prevention of ‘cyber-crime’, including illegal loan apps. Further, RBI has been conducting electronic-banking awareness and training (e-BAAT) programmes which focuses on awareness about frauds and risk mitigation.

Police’ and ‘Public Order’ are State subjects as per the Seventh Schedule of the Constitution of India. The States/UTs are primarily responsible for the prevention, detection, investigation and prosecution of crimes including illegal mobile applications through their Law Enforcement Agencies (LEAs). The Central Government supplements the initiatives of the States/UTs through advisories and financial assistance under various schemes for capacity building of LEAs.

This information was given by the Minister of State in the Ministry of Finance Shri Pankaj Chaudhary in Rajya Sabha today.

Digital lending regulation tightens app vetting and reporting mechanisms to curb fraudulent loan apps nationwide. Digital lending regulation is reinforced via RBI guidelines requiring Regulated Entities to comply, with supervisory checks and possible enforcement for non-compliance. RBI operates a Digital Lending Apps (DLA) directory for consumer verification. MeitY can block fraudulent apps under the IT framework, intermediaries must implement technology-driven vetting to curb malicious advertisements, and national cybercrime reporting and helpline channels enable public reporting. States lead investigation and prosecution, supported by central advisories, capacity-building and public awareness efforts.