Roundtable - Whitelisting Framework for Digital Lending Apps
With the FinTech revolution in India’s credit markets, the rapid sectoral growth brought along its own set of perils. Borrowers bore the brunt of unchecked digital lending practices which took the form of lending at exorbitant interest rates, unethical and predatory recovery practices, additional hidden charges in lending transactions, misuse of customers’ data, etc. While a favourable policy and regulatory infrastructure for digital lending services was in the pipeline, Chase India proactively championed the creation of a comprehensive report titled 'Whitelisting Framework for Digital Lending Apps (DLAs) followed by a roundtable discussion on the same.' To further discuss and develop on the policy roadmap, basis the recommendations in the report, Chase India & IndiaTech.org hosted an invite-only roundtable on 'A Whitelisting Framework for Digital Lending Apps (DLAs)’ on 17th May, 2023.
The roundtable saw participation from representatives belonging to Government – Abhijit Phukon, Economic Adviser, Department of Financial Services (DFS), MoF; Former RBI - Deepalipant Joshi, Former Executive Director (ED), RBI & S. Ganesh Kumar, Former ED, RBI; Civil Society Organisations - Vidhi Legal, National Institute of Public Finance and Policy (NIPFP), etc; Academia - Indian Institute of Foreign Trade (IIFT), Indian Institute of Public Administration (IIPA), etc; and Industry – BharatPE, Slice, INDMoney, etc.
The participants churned out suggestions for introducing an inclusive, transparent, collaborative and innovation-friendly framework, and to enhance the overall digital lending governance regime in India. Participants at the event discussed the need for a whitelisting framework for Digital Lending Apps (DLAs), the importance of regulatory transparency and consumer protection, the need to address challenges of systemic risk and uniformity in regulations for super-apps, and considered the possibility of forming a Self-Regulatory Organization (SRO), with some cautionary notes about potential industry capture. Post event, the report findings were also presented before the Parliamentary Standing Committee on Finance and the same was also adopted and further recommended by the Committee in its latest report on 'Cyber Security and Rising Incidence of Cyber/White Collar Crimes'.
