Key Points
The Reserve Bank of India (RBI) is pushing for digital technologies to boost inclusion, cost efficiency, innovation, and customer experience..
However, it steps in when digital lending introduces risks, creates complex structures, or promotes aggressive practices like intrusive data collection, according to the central bank's deputy governor, Swaminathan J.. "It is disheartening to see innovative misinterpretation of regulations..
The regulations, as originally conceived, envisaged the platforms to function like online marketplaces connecting lenders with borrowers, with no credit risk borne by the platform and no co-mingling or retention of funds," said Swaminathan..
Swaminathan highlighted that the RBI has been fostering digital innovation by launching regulatory sandboxes, organizing global hackathons, and establishing the Reserve Bank Innovation Hub to advance digital financial solutions..
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