Apps

India to decide which lending apps are allowed in app stores in latest crackdown

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India plans to determine which loan apps are allowed in app stores in the country, the latest in a series of recent moves from the world’s second-largest internet market to crackdown on sketchy and unethical lenders.

The Reserve Bank of India, the country’s central bank, will create a “whitelist” of all legal apps and the country’s IT ministry will ensure that only whitelisted apps are hosted in app stores, it said the Ministry of Finance in a statement.

The central bank will also monitor “mule” or “rented” accounts for money laundering and review and revoke licenses from non-bank financial institutions if found guilty, the Treasury Department said Friday.

Payment aggregators in the country are required to register within a certain time frame, and the Indian Ministry of Corporate Affairs will work to identify shell companies and deregister them to prevent abuse.

Indian authorities have taken strict action against lending apps that charge exorbitant fees and use unethical means to recover payments. India’s central bank said earlier this month it was making progress with new digital lending guidelines that would require companies to provide greater disclosure and transparency for the benefit of consumers, as well as restrict various business practices.

Google said last month it had blocked more than 2,000 unethical lending apps in India this year.

In India, dozens of credit apps have mushroomed in recent quarters, many offering loans to customers with no credit score and poor savings and later using unethical means to recover their money.

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