The Reserve Bank of India (RBI) is contemplating stepping up its efforts to curb the growing menace of cyber fraud by establishing a Digital India Trust Agency (DIGITA).
The agency’s primary objective would be to verify digital lending apps and maintain a public register of authenticated apps. This move is expected to serve as a pivotal checkpoint in the fight against financial crimes in the digital realm.
Verification Process for Transparency
Sources familiar with the matter revealed that once DIGITA is in place, it will be responsible for vetting digital lending apps through a thorough verification process. This initiative aims to bring greater transparency and accountability to the burgeoning digital lending sector, which has been plagued by a surge in fraudulent activities and unscrupulous practices in recent times.
The RBI has already shared a list of 442 unique digital lending apps with the IT Ministry to whitelist with Google. In February this year, the government disclosed in Parliament that Google had removed over 2,200 digital lending apps from its app store between September 2022 and August 2023.
Government Collaboration with Google
Bhagwat K Karad, the Minister of State for Finance, stated that according to information provided by the Ministry of Electronics and Information Technology (MeitY), Google reviewed approximately 3,500 to 4,000 loan apps from April 2021 to July 2022 and suspended or removed more than 2,500 of them from its Play Store.
The collaboration between the government and Google has been instrumental in eradicating fraudulent practices and protecting consumers from falling prey to unscrupulous lending apps. The establishment of DIGITA is expected to further strengthen these efforts and provide a more secure environment for digital lending.
The RBI’s proactive approach to tackling cyber fraud through the proposed Digital India Trust Agency is a welcome move that will instill confidence in the digital lending ecosystem. By ensuring that only verified apps are allowed to operate, the central bank aims to safeguard the interests of borrowers and promote responsible lending practices in the digital age.
