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Kerala to introduce law to regulate predatory loan apps: Report

cyber crime

The Kerala government is mulling a legal framework to regulate predatory digital lending apps, the News Minute reported. In recent months, a spate of suicides have taken place across multiple Indian cities as borrowers complain of harassment by purported employees of these digital lending apps. These apps are essentially unregulated, fly-by-the-night operators that offer low value loans for short-periods of time but at exorbitant interest rates. The report says the government's decision to bring in legislation came after a motion was introduced by Congress Member of Legislative Assembly K Sabarinath to introduce an appropriate law to regulate these apps, taking into account the various irregularities and issues that consumers have raised. Kerala Industries Minister EP Jayarajan said that at least 63 cases have been registered in the state so far and that according to the Kerala police, there are at least 400 such apps functioning from outside the state, the report says. Further, the Kerala Police's Crime Branch is also investigating these frauds that have taken place in the state through online loan apps, it added. Once a bill is framed and passed by the legislative assembly, Kerala will be the first state to enact a law to safeguard consumers from these predatory lending apps. RBI warns of predatory lending apps In a warning issued last month, the Reserve Bank of India (RBI) said that these apps charge excessive rates of interest, have hidden charges, unacceptable and high-handed recovery methods and the misuse of agreements to access data on the…

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