RBI Guidelines on Digital Lending – Point No 5.3 – Just Awesome

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           Reserve Bank of India today released the Guidelines on Digital Lending



          The guidelines are applicable to

  • ·       All Commercial Banks,
  • ·       Primary (Urban) Co-operative Banks,
  • ·       State Co-operative Banks,
  • ·       District Central Co-operative Banks;
  • ·       Non-Banking Financial Companies (including Housing Finance Companies)


  • RBI Regulated Entities  (REs) can have outsourcing arrangements with Lending Service Provider (LSP)/ Digital Lending App (DLA)

However, the Res have to ensure that the LSPs engaged by them and the DLAs (either of the RE or of the LSP engaged by the RE) comply with the guidelines contained in this circular.

 

Go Live Date

01) ‘Existing customers availing fresh loans’ and to ‘new customers getting onboarded’, from the date of this circular

 

02)                  Time till November 30, 2022, to put in place adequate systems and processes to ensure that ‘existing digital loans’ (sanctioned as on the date of the circular) are also in compliance with these guidelines in both letter and spirit.

The below point is just AWESOME

 

Quote

5.3. Digitally signed documents – REs shall ensure that digitally signed documents  (on the letter head of the RE) viz., KFS, summary of loan product, sanction letter, terms and conditions, account statements, privacy policies of the LSPs/DLAs with respect to borrowers data, etc. shall automatically flow to the borrowers on their registered and verified email/ SMS upon execution of the loan contract/ transactions.

 

Unquote

 

Digital Lending: A remote and automated lending process, largely by use of seamless digital technologies for customer acquisition, credit assessment, loan approval, disbursement, recovery, and associated customer service.

Read the full guidelines @ https://www.rbi.org.in/Scripts/NotificationUser.aspx?Id=12382&Mode=0

 

Disclaimer: These are my personal views only. The bottom line is Safe ePayments. Nothing More – Nothing Less.

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