P2P lending is a niche area which needs attention. Many start-ups in India are based on this network. The RBI is also trying to issue guidelines based on this. Some of the points that can be noted are-
- Every lender or borrower will have an unique digital ID, seeded with Aadhar ID.
- There would be no cash transactions, but transactions with trails via electronic means.
- There would be a threshold level for which P2P will fetch returns.
- P2P institutions will be registered under a company in NBFC. This allows RBI to audit the companies.
- There will be a cap on the upper and lower limit of the transactions by the RBI.
- No “Brick & Mortar” presence in India, but registered offices and institutions.
- Quarterly Reports on loans and financial status to be submitted to the RBI.
- Under the Company’s Act, RBI to audit the companies on Quarterly basis.
- There would be a confidentiality of the customer data.
- Loan recovery to follow norms for recovery practices with guidelines from the RBI.