Let’s end the fintech lending modes of the Wild West
The internet promised to revolutionize the way we live, work and play. This commitment is largely if not fully fulfilled. Gaps between assurances and reality have arisen due to fundamental misunderstandings of what the web can (or should) deliver, as well as regulatory gray areas that allow intruders to justify unethical business practices. It’s a bit like wild capital markets before regulatory frameworks minimized inequality and made trade more democratic and rule-based. Nearly 150 years after the gold rush, some companies are now doing business on the Internet like prospecting in the Wild West; their business model is based on unfair business practices and zero liability. Fintech lending is quickly becoming one such activity, belying its original promise of efficient and cheaper credit transactions without borrowers having to spend harrowing days filling out meaningless forms or ticking innocuous boxes. Yet it seems, from reports and recommendations on digital lending from a task force set up by the Reserve Bank of India (RBI), that fintech lenders in India have been playing fast and loose with the rules. and existing regulations and have engaged in unethical practices.