Crackdown has loan apps scrambling to prove their legitimacy

Why read this story?

Editor's note: On Monday morning, B, the founder of a leading digital lending firm, was drafting an action memo to plan for the week ahead. Nothing could have prepared him or his team for what lay ahead. Forty-eight hours later, B was pacing the halls of the Ministry of Electronics and Information Technology in New Delhi, anxiously preparing for a meeting with a team of government officials on which hinged the very survival of his business.    In those intervening 48 hours, the government drew up a list of over 90 fintech apps. B’s loan app was one of them. While some on the list like LazyPay, Faircent, Kissht and Indiabulls Home Loans saw their websites blocked right away, others such as Ola’s Avail Finance, KreditBee and TrueBalance were to be taken down from app stores. A chunk of the apps were issued warnings. All the apps on the list now have to submit a list of documents and prove their legitimacy as part of the government’s review process, initiated by an inter-ministerial committee of MeitY and the Ministry of Home Affairs, according …