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New Bill proposes jail, stiff fine for unregulated lending

The Indian government has introduced a new bill aimed at regulating digital lending practices by proposing amendments to the Chit Funds Act, 1982, and the Banning of Unregulated Deposit Schemes Act, 2019. This legislative move seeks to classify unregulated lending as a cognizable and non-bailable offence, thereby enhancing the legal framework to curb fraudulent digital lending activities. The bill addresses the growing concerns over the exploitation of borrowers by unregulated digital lending apps, which often charge exorbitant interest rates and use coercive recovery methods. By making these offences cognizable, law enforcement agencies will have the authority to arrest without a warrant, and the non-bailable aspect means that bail will not be a matter of right, aiming to deter potential offenders and protect consumers from predatory lending practices.

Read the Full Business Line Article at:
[ https://www.thehindubusinessline.com/economy/govt-proposes-fresh-bill-to-treat-unregulated-lending-as-cognizable-and-non-bailable-offence/article69004733.ece ]