Last updated 12 Nov 2026
A genuine digital lender is a bank or a registered non-bank lender, shows you a Key Fact Statement before you sign, pays the loan into your own bank account, does not read your contacts or photos, and gives you a named person to complain to. If an app asks for access to your contacts, wants a fee before releasing money, or pushes you to decide within minutes, treat it as unsafe and walk away.
Digital lending has made borrowing easier, and it has also given fraudsters a place to hide. The Reserve Bank of India (RBI) regulates the banks and non-bank lenders it oversees, and its Reserve Bank of India (Digital Lending) Directions, 2025 set rules on how they, and the platforms that work with them, must behave. This guide explains those rules in plain words, and each rule below is taken from the Directions as read on the RBI site.
Seven signs of a fake or abusive loan app
- It asks for access to your contacts, photos, call logs or files. The Directions say apps must not access these; one-time access to camera, microphone or location for KYC with your consent is allowed.
- It asks you to pay a fee, deposit or insurance before the loan is paid out.
- It will not name the lender (bank or non-bank) behind the loan.
- It offers a loan to anyone and says no documents or checks are needed.
- It wants the loan paid into an account that is not yours.
- It sends threats, shame messages or calls to your contacts.
- It does not show you the amount, tenor, APR, charges and repayment schedule before you accept.
What the RBI Digital Lending Directions give you
Protections you can rely on (RBI Digital Lending Directions, 2025)
| Protection | What it means | Paragraph |
|---|---|---|
| Key Fact Statement | A KFS must be provided; with several lenders on one platform, each lender's KFS link must be given | 6(iii), 8(i) |
| Signed documents sent to you | Digitally signed documents, including the KFS, must go to your registered email or SMS at execution | 8(iii) |
| Cooling-off period | You can exit a digital loan within a cooling-off period of at least one day, set by the lender's board, by repaying principal and proportionate APR | 10 |
| Money goes to you | Disbursal goes to your bank account; transfers to a platform's account are not allowed, with narrow exceptions | 9(i) |
| Repayment goes to the lender | Repayments go directly to the lender's account, with no pass-through accounts | 9(ii) |
| Platform fees are not yours to pay | The platform's fee is paid by the lender and cannot be collected from you | 9(iv) |
| Consent and limited data | Data collection must be need-based with your prior explicit consent; you can restrict sharing and ask for deletion | 12 |
| Data stored in India | Servers must be in India, with strict rules on processing abroad | 13(iv) |
| Named grievance officers | Lenders and platforms must name nodal grievance officers, displayed on websites, apps and the KFS | 11 |
| Public app directory | Lenders must report their apps to RBI, which publishes the data | 17 |
Source: Reserve Bank of India (Digital Lending) Directions, 2025, as read on the RBI website. Check the current text before relying on a specific paragraph.
Check the app before you borrow
- Ask which bank or registered non-bank lender is making the loan. Find its details on the RBI website.
- Look in the RBI's published directory of digital lending apps. The Directions state that listing is not RBI registration or endorsement, and apps must not claim otherwise, so use it to check that a lender has reported the app, not as proof of safety.
- Check the app's permissions on your phone. Deny contacts, files and call logs.
- Read the KFS: amount, tenor, APR, all charges, penal charges and the grievance officer's details.
- Make sure the loan will be paid to your own bank account.
A worked example of a trap
A person needs ₹20,000 urgently and installs an app that promises the money in minutes. The app asks for contacts and photos, shows a loan of ₹20,000 but credits only ₹14,000 after deducting charges, and sets repayment in seven days. When the repayment is late, messages go to people in the borrower's contact list. This pattern, hidden deductions, a very short tenor and contact access, is the opposite of what the Directions allow. The right response is to stop, not to borrow from another app to pay the first.
If you are targeted
- Do not pay more money to stop threats. Keep screenshots, call logs and messages.
- Write to the lender's grievance officer, named in the KFS or on its website.
- If the lender rejects your complaint, does not respond within 30 days, or you are not satisfied, you can complain through the RBI's CMS portal under the Integrated Ombudsman Scheme, or write to the Centralised Receipt and Processing Centre in Chandigarh, as the Directions provide.
- Report threats, extortion or misuse of your photos to the police and through the national cyber crime reporting channel.
- Tell your family or friends not to respond to messages from the app.
How LOANZ 360 fits in
LOANZ 360 is a loan aggregator, not a lender. It works for partner banks and NBFCs. Every loan is decided, priced, sanctioned and paid out by the lender into your own bank account. You give a clear, item-by-item consent, and can withdraw it as easily as you gave it. Your data is masked by default and stored in India. Read the digital lending disclosures, the borrower rights and how it works.
Frequently asked questions
Can a loan app access my contacts?
The RBI Digital Lending Directions say apps must not access files, media, contacts, call logs or telephony functions. One-time access to camera, microphone or location is allowed for KYC with your consent. An app asking for contacts is a warning sign.
Can I cancel a digital loan after taking it?
Yes, within the cooling-off period, set by the lender's board at no less than one day. You repay the principal and proportionate APR. The lender may keep a reasonable one-time processing fee if it was disclosed upfront in the KFS.
Is an app in the RBI directory safe?
Not automatically. The Directions state that inclusion in the directory does not imply RBI registration or endorsement. It shows that a lender has reported the app, not that it is approved.
Who pays the platform's fee?
Under the Directions, the platform's fee is paid by the lender and cannot be collected from the borrower. Be careful if anyone asks you to pay a fee to a platform or agent.
Where do I complain if the lender ignores me?
First write to the lender's nodal grievance officer. If the complaint is rejected, unresolved within 30 days or you are unsatisfied, use the RBI's complaint portal under the Integrated Ombudsman Scheme.
Does LOANZ 360 take my data and share it freely?
No. Nothing is checked or shared without your consent, given item by item, and you can withdraw it. Your data is masked by default and stored in India. See the your-data page for details.
Related reading: Borrower rights and grievance, Key Fact Statement and APR, Loan documents and KYC, Missed EMI consequences, Digital lending disclosures, Your data, Grievance, Cooling-off period, Key Fact Statement.