The Ministry of Electronics and Information Technology will then ensure that only these whitelisted digital lending applications are hosted on app stores, the finance ministry said in a statement.
“The finance minister expressed concern on increasing instances of Illegal Loan Apps offering loans/micro credits, especially to vulnerable and low-income group people at exorbitantly high interest rates and processing/hidden charges, and predatory recovery practices involving blackmailing and criminal intimidation," the finance ministry said in a statement.
Sitharaman also noted the possibility of money laundering, tax evasions, breach/privacy of data, and misuse of unregulated payment aggregators, shell companies, defunct NBFCs etc. for perpetrating such actions.
After detailed deliberations on legal, procedural and technical aspects of the issue, it was decided in the meeting that:
> RBI will prepare a “Whitelist" of all the legal Apps and MeitY will ensure that only these “Whitelist" Apps are hosted on App Stores.
> RBI will monitor the ‘mule/rented’ accounts that may be used for money laundering and to review/cancel dormant NBFCs to avoid their misuse.
> RBI will ensure that registration of payment aggregators be completed within a timeframe and no un-registered payment aggregator be allowed to function after that.
> MCA will identify shell companies and de-register them to prevent their misuse.
> Steps should be taken to increase cyber awareness for customers, bank employees, law enforcement agencies and other stakeholders.
> All Ministries/Agencies to take all possible actions to prevent operations of such Illegal Loan Apps.
The meeting was attended by secretaries from the finance, corporate affairs, and information technology ministries along with officials from the RBI, comes in the wake of increasing concerns surrounding illegal mobile-based loan apps.
