New Delhi: A fintech startup that is in the digital lending sector and is on the rise has shown to be under the regulation this week. It has been reported that the Reserve Bank has been requesting clarification on its lending model, customer onboarding process, and the information on interest rates.
It has been accused that the company had been charging high processing fees and vague penalty structures. There have been online complaints by some users that it engages in aggressive loan recovery practices and hidden charges.
The start-up has refuted the allegation and claimed that it operates according to all digital lending standards. It has vowed to cooperate fully with the regulators and has embarked on internal process review.
In India, the digital lending market is growing at a very fast rate and the case has put the issue in the spotlight again. Although fintech has enabled many people to access credit facilities, the issue of consumer protection and ethical lending is still high.
