RBI’s DIGITA Initiative: Curbing Illegal Lending Apps

The Reserve Bank of India (RBI) is contemplating the establishment of the Digital India Trust Agency (DIGITA) to combat the proliferation of illegal lending apps. This initiative aims to bolster cybersecurity measures and clamp down on fraudulent activities in the digital lending sector.

Purpose of DIGITA

  1. Verification and Oversight: DIGITA will facilitate the verification of digital lending apps and maintain a public register of verified apps.
  2. Legal Enforcement: Apps lacking the ‘verified’ signature of DIGITA will be deemed unauthorized for law enforcement purposes, creating a pivotal checkpoint against financial crimes in the digital domain.
  3. Transparency and Accountability: The verification process will promote transparency and accountability within the digital lending sector, mitigating fraudulent practices.

RBI’s Collaboration with IT Ministry and Google

  1. Whitelisting Efforts: RBI has provided a list of 442 digital lending apps to the IT Ministry for whitelisting with Google, enhancing app legitimacy.
  2. App Removal by Google: Google has removed over 2,200 digital lending apps from its app store between September 2022 and August 2023, aligning with RBI’s regulatory directives.
  3. Updated Policy by Google: Google’s policy change regarding the enforcement of loan apps on PlayStore now mandates that only apps published by RBI’s regulated entities or their partners are permissible, following requests from RBI and the Department of Financial Services under the Finance Ministry.

Piyush Shukla

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