For the first time , the Fintech industry  which is offering small ticket size loans digitally  has  come under the scanner of the RBI for unhealthy lending practices in the market. The rise of instant loan app platforms has also encouraged many  unregulated entities , which are not registered with RBI as NBFCs to take  advantage of the small Borrowers. There are many apps that have tie-up with banks and NBFCs for loans. In  fact , the  casual approach of some of the regulated players is also responsible for  these bad practices.  The recent instances of borrowers committing  suicide has already forced the  RBI to set up a working group to study the issues like consumer protection , data privacy, charging high interest rates, and  harsh recovery methods. The Government and regulators have to monitor the space more closely to plug the regulatory gaps and  keep strengthening the regulations time and again. Digital lending is the future for serving the under - banked and under -served customers both in metros and rural areas. Anand Adhikari, Executive Editor, Business Today, explains more.

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