In India, innovative business models for providing credit to underserved segments have led to the rise of digital lending. By 2023, India’s digital lending market is expected to reach $350 billion. According to industry reports, low-income, new-to-credit (NTC) borrowers account for more than 60% of digital lending via platforms and mobile apps at the moment.
There are a number of loan apps, but not all of them are registered or regulated and offer consumers low-cost loans. The RBI has therefore developed revised digital lending guidelines to safeguard consumers and borrowers from such dishonest lending practices. Credit can be accessed in a secure, inclusive, and accessible manner thanks to this policy.
Shoppers ought to consider the accompanying elements while picking the right advanced loaning stage, as this will assist with protecting their inclinations:
- Does it belong to the RBI?
Pick a platform that is associated with a bank or an NBFC that is registered with the Reserve Bank of India (RBI). A list of banks and NBFCs is available on the RBI website, so the borrower can quickly determine whether the lender is authorized to lend money. This will assist in determining whether the customer’s chosen lender is regulated by law, lowering the likelihood that they will choose an unauthorized lender. The best way to borrow money is through apps and websites of registered digital lenders. - Credibility of the lender as well as its presence in India
Borrowers should not be lured into taking out a loan by gimmicks or lucrative promises. Instead, they ought to spend some time researching the lender, and they ought to select the lender based on the information and research they discover. While online financial services offer the most user-friendly experience and straightforward procedures, a lack of caution can result in a negative experience. It is vital to make a point to ask about the loan specialist’s presence in India; If this is the case, the lender will be subject to RBI rules and follow them, making them a reliable source for credit access. - Provides customer assistance and has a valid website
It is substantially more advantageous, agreeable, and less unpleasant thanks to advanced loaning administrations. Customers can have loans deposited directly into their bank accounts from the convenience of their homes within a few hours of submitting an application. AI and chatbots also offer support round-the-clock. As a result, lending has become incredibly simple.
However, simplicity comes with some risks; consequently, it is also the customer’s responsibility to ensure that the information they provide, the lender they rely on, and the course of their loan are compliant with applicable laws. Since dubious apps have also begun creating fake websites, one needs to make sure they are checking the correct website when checking the websites of lending institutions.
- Check the Play Store rating
Check the platform’s rating on the Play Store and read the page’s description to learn more about the lender, its lending policies, and its customer-friendly terms and conditions. Borrowers should also check the platform’s rating on the Play Store.
They should avoid downloading lender applications that are not registered and are not regulated. A quick look at the reviews and the people who wrote them will also help you determine whether or not they are genuine. Further, if the application has been as of late transferred or has not very many downloads, it is prudent to stay away from such applications.
- Read the terms and conditions thoroughly
Before proceeding with the loan application process. Borrowers must confirm that they have read, comprehended, and agree to the terms and conditions. They need to be careful about the lender’s credibility and make sure that the lender has a good grievance redressal system they can use if there is a problem with the app or lender. They should not proceed further until they are aware of the terms, conditions, charges, and other significant conditions.
Borrowers can choose the best digital lending platform for their next credit need by following these five easy steps. Being educated as a client is better compared to being clueless while entering the credit market. Through reputable digital lending platforms, a consumer with more knowledge and education will be able to obtain credit and conduct more transactions, thereby expanding the country’s financial inclusion.
