The Reserve Bank of India is contemplating the establishment of the Digital India Trust Agency (DIGITA) in a move to combat the escalating cyber fraud.
This initiative aims to clamp down on the proliferation of illicit lending applications by instituting a verification system for digital lending apps and maintaining a public registry of those that are verified, according to informed sources.
DIGITA’s mandate would include the crucial task of vetting digital lending applications, marking a major step in the ongoing battle against financial crimes in the digital domain. Apps lacking DIGITA’s ‘verified’ endorsement would be deemed unauthorized, reinforcing the legal framework against unregulated financial activities.
The introduction of such a verification process is expected to bring about enhanced transparency and accountability in the rapidly expanding digital lending sector, which has been marred by increasing incidents of fraud and unethical practices.
In tandem with these developments, the Reserve Bank of India has reportedly forwarded a list of 442 unique digital lending applications to the Ministry of Information Technology, recommending their inclusion in Google’s whitelist.
Google, on its part, has taken down more than 2,200 digital lending apps from its Play Store in the period from September 2022 to August 2023, adhering to a policy revision.
This adjustment, made at the behest of the RBI and the Department of Financial Services under the Ministry of Finance, permits only those loan applications that are either published by RBI-regulated entities or those that collaborate with such entities.
This coordinated effort between the regulatory authority, government departments, and technology platforms underscores a comprehensive approach to safeguarding consumers in the digital financial landscape.