Digital Borrowers – Do You Know Your Rights & Exercise Them?

Digital lenders tamed on our complaint
Have you taken a loan from any App based loan Company and are being harassed for being not able to pay them during this pandemic time? If so, there is good news for you, now they can’t harass you anymore.

Let’s find out why and how?
Friends, in the below linked  article I had raised the issue of outrageous interest rates being charged by China backed loan lending apps and excessive use of muscle power and bullying tactics to recover these loans.

Use of personal data and information to blackmail these customers and many such illegal means to recover the loans.

In this regard, I wrote to the Honourable Prime Minister of India, as well as various other concerned ministers, including India’s Finance Minister, Home Minister, IT Minister, I&B Minister and Consumer Affairs Minister and raised this issue through social media, asking the government to take stern action against these Fintech Companies, mostly backed by China.

These Chinese companies entered into the Indian market through the backdoor, after being banned in China, for their unethical and illegal business practices and were playing havoc with customers in India.

Finally, the government has decided to act and has announced a host of guidelines to rein these unruly Fintech Companies.

Disclose Bank’s Name On The App

These companies used to operate without any disclosure, name and address but now it is mandatory for them to disclose all relevant information on their websites. This discloser will help the consumers to take action against these companies in case of any dispute, which was not possible so far.

It came to the forefront during the loan moratorium period because most borrowers from these digital lending platforms didn’t know whether they will get the loan moratorium or not. The requests for loan moratorium were rejected by these digital lenders.

Similarly, digital lending platforms have been asked to inform their customers upfront about the names of banks/ NBFCs on whose behalf they are disbursing the loans.

This information has to be shared irrespective of whether banks or NBFCs lend through their own digital lending platform or through an outsourced lending platform.

Furnish Sanction Letter And Loan Agreement To Customers

RBI now also wants to have a sanction letter issued to the borrower on the letterhead of the bank / NBFC concerned while applying for the loan. Also, a copy of the loan agreement shall be furnished to all borrowers at the time of sanction/ disbursement of loans.

I hope these measures will help the consumers to a large extent but I will still recommend to take loans from established and reputed banks by visiting their branch.

In case of any harassment, now you have the weapon to lodge a police complaint to take action against these companies.

Last but not least, do no forget as a consumer, you too have your rights and lending agencies just can’t barge into your house and misuse your personal data to recover the loans or even charge exorbitant rates of interest. So, if you have any such problem do consult your local lawyer.

Contributed by AJAY KUMMAR, LLM, MBA (UK), AIMA 
Advocate and Consultants (Litigation, Criminal, Civil, Business, & Legal Consultancy) 
Supreme Law International, Delhi & Dubai, Veteran Journalist, 
National Spokesperson Lok Janshakti Party, NDA Govt of PM Modi

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