RBI Authorization List for Digital Lenders to Verify Google Play Store Access Control Credentials










The crackdown on illegal loan applications in India has taken a new turn, with the government teaming up with the Reserve Bank of India (RBI) to tackle this menace in depth. The country’s finance ministry on September 9 said the banking regulator would create an allow list for digital lending apps, while the ministry of electronics and information technology (MeiTY) would ensure that only these apps are allowed on Google Play Store and Apple App Store. .

With this decision, the Indian government intends to weed out the illegal microcredit apps that have mushroomed on these app stores during the pandemic. But the step is as much about cracking down on illegal apps as it is wresting control from Google, which acts as the gatekeeper for any apps that seek to get on the Play Store. It even has its own set of rules.

Google doesn’t allow apps that promote short-term personal loans, which require full repayment in 60 days, and loans with a

annual percentage rate of charge (APR)


annual percentage rate of charge (APR)

APR
APR is the cost you pay each year to borrow money, including fees, expressed as a percentage


36% or more, calculated in accordance with the U.S. Truth in Lending Act

(US TILA).


(US TILA).

Truth in Lending Act
It protects US citizens from unfair billing practices. It requires lenders to provide users with loan cost information so they can compare different types of loans.


While these

conditions


conditions

Google
Financial services
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are meant to reduce the threat of illegal lending apps, Indian fintechs claim that some of these terms also block bona fide lending apps.

Fintech founders, who declined to be named because they wouldn’t comment publicly on regulatory issues, say their apps have been on and off the Play Store since Google introduced the 60-day rule in

2019


2019

android font
Google releases Play Store policies for personal loan apps
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. One said that some apps even have to beg Google to let them stay.

This rule has a direct impact on borrowers. If a user takes out a 30 day loan, they pay less interest than on a 60 or 180 day loan. By blocking short-term loans, Google is forcing users in India to opt for longer-term loans with a higher interest rate, says a fintech founder. “So the situation was that even if you stayed on the Play Store with more visibility, you would still lose users,” they said.

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