Delhi HC Seeks RBI Response On Data Misuse By Digital Lending Apps

The Delhi High Court has sought a response from the Reserve Bank of India on allegations that digital lending applications are illegally accessing and misusing borrowers’ financial data. The petition raises concerns over violations of data protection rights by non-banking financial companies operating through digital platforms. During the hearing, the court referred to the RBI’s statutory “Digital Lending Directions, 2025,” which lay down safeguards to prevent excessive data collection and misuse, and mandate grievance redressal mechanisms. The court has directed the RBI to file a detailed counter affidavit explaining the steps taken to enforce these guidelines and the action initiated against entities found violating the rules. The RBI has been given six weeks to submit its response.