Personal loan apps have taken over the market in the past few years.
The ease of use and easy approval process has made them popular but concerns are now being raised about such simplicity in a complex matter like applying for loans.
Google had taken note of such issues and wanted the personal loan apps in India to submit additional proof of eligibility requirements and it had set a deadline for these apps to comply with the new rules.
“If you are licensed by the RBI to provide personal loans, you must submit a copy of your license for our review,” Google highlighted via a blogpost.
The said eligibility is determined when the company provides a copy of their license by the Reserve Bank of India (RBI).
The second, and the more important criteria is regarding a declaration that states the app are not directly engaged in money lending activities and merely provides a platform to facilitate moneylending to the consumers.
“If you are not directly engaged in money lending activities and are only providing a platform to facilitate moneylending by registered Non-Banking Financial Companies (NBFCs) or banks to users, you will need to accurately reflect this in the declaration,” it added.
Google also wants better transparency from the entities, which includes mentioning the names of all registered NBFCs and banks.
It also wants better clarity on the creator/owner of the loan apps, so that it matches the name of the associated registered business name provided through the declaration provided by the firm.
Along with India, Google wants to mandate these rules in countries like Indonesia and the Philippines as well.
Multiple reports have talked about the discomfort caused by small personal apps mushrooming in the country over the past year.
People sign up for the convenience but any non-payment is treated with disdain, which has allegedly put many people on the brink of ending their lives.