Answer Book question
Very little of what it is doing. Under RBI's Digital Lending Directions, 2025 (consolidating the 2022 guidelines), any legitimate digital loan must come from a bank or RBI-registered NBFC; the app must tell you who the lender is; the money must be paid directly into your bank account and repaid directly to the lender, never through the app's own account; you must get a Key Fact Statement with the annual percentage rate before signing; you have a cooling-off period of at least one day to exit without penalty; the app may not access your contacts, call logs or photos except for a one-time KYC need; and you must be told the name of any recovery agent before contact. An app that shames you to your contacts is breaking the rules, and if it is not backed by a regulated lender, it is simply illegal.
Very little of what it is doing.
Under RBI's Digital Lending Directions, 2025 (consolidating the 2022 guidelines), any legitimate digital loan must come from a bank or RBI-registered NBFC; the app must tell you who the lender is; the money must be paid directly into your bank account and repaid directly to the lender, never through the app's own account; you must get a Key Fact Statement with the annual percentage rate before signing; you have a cooling-off period of at least one day to exit without penalty; the app may not access your contacts, call logs or photos except for a one-time KYC need; and you must be told the name of any recovery agent before contact.
An app that shames you to your contacts is breaking the rules, and if it is not backed by a regulated lender, it is simply illegal.
A student in Adoor borrows ₹8,000 from an app; after a week the app demands ₹14,000 and messages his contact list calling him a fraud. The app is not linked to any registered lender. He reports to cybercrime.gov.in and 1930, blocks the app, and writes to the RBI's Sachet portal. Legitimate apps appear on the lender's website and in the RBI-DoT list; this one does not.
The RBI (Digital Lending) Directions, 2025, effective from mid-2025, apply to all banks, cooperative banks, NBFCs and housing finance companies lending through apps, directly or via Lending Service Providers.
Key borrower protections: identification of the regulated lender on the app and the loan documents; a standardised Key Fact Statement with APR, tenor, repayment schedule, penalties and the grievance officer; direct disbursal to the borrower's bank account and direct repayment to the lender; no fees charged by the LSP to the borrower; a board-approved cooling-off period of at least one day to exit by repaying principal and proportionate APR, with at most a disclosed processing fee; digitally signed loan documents delivered automatically; data collection limited to need, with explicit consent, no access to contacts, call logs or media beyond one-time KYC, and storage in India; recovery-agent details communicated before contact; a nodal grievance officer for the lender and the LSP, and escalation to the RBI Ombudsman if unresolved in 30 days.
Apps not backed by a regulated entity are outside RBI's protection and are dealt with by the police and the IT Ministry, which has blocked hundreds. The RBI's Sachet portal and the Ministry's list of apps whitelisted by regulated lenders are the reference. Loan apps' harassment is also covered by the recovery-conduct rules (Loans 6).
Is a bank or registered NBFC named as lender in the app, the KFS and the sanction letter? If not, stop Did the money come into your bank account directly from that lender? The Key Fact Statement: APR and total cost; compare against what is now being demanded Permissions the app took on the phone; revoke contacts, media and call logs The grievance officer's name and the 30-day clock
Paying the inflated demand to make the messages stop. They do not stop; the app has learned you pay. Also: borrowing from a second app to pay the first.
Kerala Police's cyber cell and the 1930 helpline have handled large numbers of loan-app cases, many involving students and Gulf families' dependants. A legitimate, registered lender's app is a reasonable product for a small, short loan if the KFS is read; the rest are to be reported and ignored.
₹8,000 borrowed, ₹1,200 'processing fee' deducted, ₹14,000 demanded after seven days: an APR in the thousands of percent, impossible under any KFS a regulated lender would issue. Report; do not pay the excess. If the lender is regulated: pay principal and lawful interest per the KFS, dispute the rest through the grievance officer and the Ombudsman.
A genuine loan from a regulated lender is still owed; the rules limit conduct, not repayment. If you gave an app your contacts and it has already messaged them, the remedy is a police complaint and the lender's grievance process; the damage to reputation needs a calm message from you to the contacts explaining the fraud.
Identify the lender; if none, report at cybercrime.gov.in and 1930, and on RBI Sachet Revoke the app's phone permissions; do not uninstall before screenshotting the demands For regulated lenders: pay per the KFS, complain to the grievance officer, escalate to cms.rbi.org.in after 30 days
Recovery agents are calling me at night and at work. What are my rights? Money was stolen from my account through a fraud. Will the bank refund it?
Loans & bank disputes · Fraud prevention
RBI (Digital Lending) Directions, 2025; RBI Guidelines on Digital Lending, September 2022 · RBI Sachet portal; Ministry of Electronics and IT whitelist of digital lending apps · National Cyber Crime Reporting Portal; helpline 1930 Last checked: 22 August 2026. Rates, limits and whether you may qualify change. Confirm with the official source before you act. Ask Kerala Rising: Use only general, non-identifying facts.
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