Centre, RBI step up action against unauthorised digital lending apps
The Government and the Reserve Bank of India (RBI) have strengthened regulatory and enforcement measures to curb fraudulent loan applications and enhance consumer protection in the digital lending ecosystem.
According to information shared in the Rajya Sabha by Minister of State for Finance Pankaj Chaudhary, the RBI had earlier constituted a Working Group on Digital Lending, covering loans extended through online platforms and mobile applications. Based on its recommendations, the central bank has issued comprehensive regulatory guidelines aimed at strengthening oversight while ensuring customer safety.
All regulated entities (REs) are required to comply with these digital lending norms. The RBI conducts periodic supervisory assessments to monitor compliance, and instances of non-compliance are addressed through corrective measures and enforcement action, wherever necessary.
In parallel, the Ministry of Electronics and Information Technology (MeitY) has been actively blocking fraudulent loan applications under Section 69A of the Information Technology Act, 2000. Such actions are taken following due process as laid down in the relevant rules.
The Government and RBI have also undertaken a series of initiatives to protect citizens from unauthorised digital lending platforms. As part of these efforts, the RBI launched a public directory of Digital Lending Apps (DLAs) on July 1, 2025. The directory enables users to verify whether a lending app is associated with a regulated entity.
Authorities are also working closely with internet intermediaries and messaging platforms to monitor and curb the spread of illegal loan apps. These platforms have been directed to deploy stricter, technology-driven verification systems and real-time enforcement mechanisms to prevent misleading advertisements, particularly those originating from offshore entities.
The Indian Cyber Crime Coordination Centre (I4C) under the Ministry of Home Affairs is actively analysing digital lending apps. Citizens can report cyber fraud, including illegal loan applications, through the National Cybercrime Reporting Portal or by calling the helpline number 1930.
Additionally, the ‘SACHET’ portal and State Level Coordination Committees (SLCCs) enable individuals to lodge complaints related to illegal deposit-taking or unauthorised financial activities.
To raise awareness, the RBI and banks are conducting outreach campaigns through SMS alerts, radio programmes, and digital initiatives such as e-BAAT, focusing on cyber fraud prevention and safe digital banking practices.
The government also reiterated that “Police” and “Public Order” are state subjects under the Constitution. State and Union Territory law enforcement agencies remain primarily responsible for investigating and prosecuting such offences, while the Centre continues to support them through advisories and capacity-building assistance.
