Image credit: Presidential Secretariat of India
The Indian government and central bank are reportedly pressuring Google to step up its checks on illegal lending apps amidst a sharp rise in such software that began during the pandemic.
The Reserve Bank of India (RBI) has called Google to several meetings in the past few months by the central bank and the Indian government, where it was urged to introduce tougher checks, Reuters reported, citing unnamed sources.
Google has also been asked to help stop such apps from spreading via websites and other channels, the report said.
A source cited in the report said Google had previously failed to respond to complaints from industry bodies on individual lending apps, but has started to be “more proactive” in such cases.
Google said in August it was instituting restrictions for financial services advertisers in India, requiring them to demonstrate they are authorised to provide such services.
The ad restrictions, which have already been introduced in the UK, Australia, Singapore and Taiwan, are to be put into place in India next month.
The Indian government earlier this month called on the RBI to prepare a whitelist of legal loan apps and tasked the Ministry of Electronics and Information Technology (MeitY) with ensuring only those apps were available on Google’s and Apple’s app stores.
Google, however is by far the dominant app provider in India, with 95 percent of smartphones in the country running on its Android platform.
India’s finance minister Nirmala Sitharman earlier this month expressed concern over the spread of illegal lending apps that target vulnerable and low-income groups, charging exorbitant interest rates and may involve “predatory” recovery practices involving blackmail and criminal intimidation.
She noted that such apps could also be involved in money laundering, tax evasion, breach of privacy of data and other illegal activities.
Google said that last year it revised its Play Store developer programme to require additional requirements for loan apps in India effective September 2021.
The company said it has removed more than 2,000 personal loan apps targeting India from the Play Store for violating policy requirements.
“We will continue to engage with law enforcement agencies and industry bodies to help address this issue,” Google said.
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