Digital Lending In India: Forces Driving Growth And RBI’s 2025 Directions
- IJLLR Journal
- 22 hours ago
- 1 min read
Devadarshini, BA LLB, Tamil Nadu Dr. Ambedkar Law University
ABSTRACT
The digital age had brought significant changes in various sectors. India’s lending sector had undergone a transformation from traditional lending services. Indian Fintech market is expected to reach $2.1 trillion by 2030 with a revenue between $190-250 billion. Digital lending is expected to contribute 53% of revenue. The Advent of technologies like AI, block chain, cloud computing had revolutionized the digital lending sector. Rise in smartphone users, digital MSME loan, use of alternative credit scoring, instant credit and Covid 19 pandemic are some of the factors which fuels the growth of digital lending in India.
RBI’s digital lending directions 2025 provides a regulatory framework on digital lending. It focuses on the data privacy of borrowers, contractual agreement between regulated entities and lending service provider, grievance redressal mechanisms, default loan guarantee and reporting requirements. This new direction consolidate 2022 digital lending guidelines and 2023 guidelines on default loan guarantee. This paper explores various factors driving the growth of digital lending in India and RBI’s 2025 directions on digital lending.
Keywords: digital lending, digital MSME loans, Covid 19 pandemic, Reserve Bank of India, Default loan Guarantee.
