Banking & Finance MCQs

The RBI's digital lending guidelines mandate that the loan disbursement must be made directly into the borrower's bank account without any pass-through to the Lending Service Provider (LSP) or any third party. This ensures transparency and accountability.

To ensure the safety and security of customer funds, RBI mandates that Payment Aggregators must maintain funds collected from customers in an escrow account with a scheduled commercial bank. This prevents co-mingling of funds and protects customer money.

As per RBI guidelines, existing Payment Aggregators were required to have a minimum net worth of ₹15 crore by March 31, 2021, and ₹25 crore by March 31, 2023, to continue their operations and obtain authorization. This ₹25 crore requirement is the standard for PAs operating in 2026.

The RBI introduced comprehensive guidelines for Payment Aggregators in March 2020, making it mandatory for all entities operating as PAs to obtain authorization from the RBI to ensure proper regulation and oversight of the digital payments ecosystem.

Under the RBI's framework, Regulated Entities (REs) are ultimately responsible for the activities of their Lending Service Providers (LSPs) and Digital Lending Apps (DLAs), including ensuring their compliance with all cybersecurity and data privacy standards. This places the onus on the REs to conduct proper due diligence and oversight.

A crucial aspect of RBI's guidelines for digital lending, reinforced in its cybersecurity framework, is the requirement for all customer data collected by LSPs on behalf of REs to be stored within the geographical boundaries of India, ensuring data localization and better regulatory oversight.

The primary objective of RBI's enhanced cybersecurity framework for digital lending is to protect consumer data and ensure that Regulated Entities (REs) and their Lending Service Providers (LSPs) adhere to robust data security and privacy standards, thereby enhancing trust and safety in the digital lending ecosystem.