RBI tightens guidelines for P2P lending platforms in an effort to increase compliance and transparency

Match/Mapp of Lenders and Borrowers should be done as per the policy approved by the Board before disbursing any loan.

P2P lending ordinanceThe RBI first issued guidelines for P2P borrowing in 2017. Aver provided me with a great example of how to bootstrap such an intermediary platform, providing an online marketplace/platform for parties interested in peer-to-peer lending.

The platforms also face major violative of Master Direction 2017. These include violating prescribed fund transfer mechanisms, and advertising peer-to-peer lending as an investment product with characteristics like guaranteed minimum returns pegged to tenure instead of a simple facilitation forum.

This includes providing liquidity options and at times acting as a depositor and lender instead of being a platform. In view of the violations by certain entities, RBI issued revised guidelines. The revised guidelines have come into effect immediately.