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RBI digital lending rules explained for borrowers: how to check loan apps

The RBI digital lending guidelines force loan apps to show the total cost of a loan upfront and stop them from stealing phone data. Learn how to check the RBI directory for legal apps, read the Key Fact Statement, and file a complaint against harassment using the official Sachet portal.

By Qrates research desk · 2026-10-27

The RBI digital lending guidelines are rules that force loan apps to show the total cost of a loan upfront and stop them from stealing phone data. They require money to move directly between a registered bank or NBFC and the borrower. You can check the Qrates loan apps directory to see if an app is licensed and what permissions it takes before you install it.

Quick answer: What are the RBI digital lending guidelines?

The RBI rules for loan apps are designed to stop hidden fees, data theft, and harassment. The rules force apps to show the total cost of a loan upfront and ban them from reading your phone contacts. Only banks and registered NBFCs can lend money, and the money must move directly between their bank account and yours.

The digital lending rules in plain words

The Key Fact Statement (KFS)

Every borrower must receive a Key Fact Statement before accepting a loan (RBI Digital Lending Directions, 2025). This document shows the exact fees and penal charges. The Key Fact Statement must include the Annual Percentage Rate representing the true cost of the loan.

Direct bank transfers

The loan amount must go straight from the Regulated Entity to the borrower. The Regulated Entity is the bank or NBFC providing the money. No Lending Service Provider can touch the money, as third-party pool accounts for loan disbursals and repayments are prohibited by the RBI.

Phone data privacy and contact list permission

Loan apps are prohibited from accessing a user's phone contact list, photo gallery, or call logs. They cannot ask for permission to read this data when you install the app. This rule stops recovery agents from calling your family and friends if you miss a payment.

How the rules work with a 50,000 rupee loan example

Here is a step-by-step look at a ₹50,000 loan under the new rules.

  1. Application: You apply for ₹50,000 on a loan app.
  2. The KFS: The app gives you a Key Fact Statement showing a 20 percent interest rate and a ₹1,500 processing fee.
  3. The APR: The KFS groups the interest rate and processing fees into a single Annual Percentage Rate so the true cost is clear.
  4. Disbursal: The partner NBFC sends the full ₹50,000 directly to your bank account.
  5. Cooling-off: Borrowers are entitled to a cooling-off period of at least one day for all digital loans.

If you change your mind during the cooling-off period, you can return the principal and proportionate interest without paying a penalty.

What to check before you install a loan app

Finding the NBFC registration

Legal loan apps must disclose the name of their partner NBFC or bank in the app store description. You should look for this name before downloading the app. If the app does not list a partner, it is breaking the rules. You can follow our guide on how to check if a loan app is RBI registered to verify their credentials.

Checking the RBI directory

Once you find the NBFC name, you must verify it against the October 2026 RBI Digital Lending App Directory. This directory lists the approved entities allowed to lend money. You can find this list on the official Reserve Bank of India website. You can visit the Qrates loan apps directory to verify the latest licence numbers, phone permissions, and complaint data for specific lending apps yourself.

Reviewing app permissions

Check the Google Play Store or Apple App Store privacy labels before you tap install. Ensure the app does not demand illegal phone permissions like access to your contacts or call logs. If it asks for these, do not install it.

Common mistakes borrowers make

Skipping the Key Fact Statement

Many borrowers accept the loan terms without reading the KFS. This causes them to miss hidden penal charges. Rules that came into effect on 1 April 2024 ban lenders from charging interest on penal charges, but you still need to know what the flat penalties are.

Paying fees to personal UPI IDs

Borrowers sometimes transfer repayment money to a recovery agent's personal UPI ID instead of the official NBFC account. You should never pay a person directly. Borrowers also make the mistake of not knowing that RBI guidelines for recovery agents restrict when and how they can contact you.

How to complain about illegal loan apps or harassment

The first step is contacting the grievance redressal officer of the app or NBFC. The grievance redressal officer of an NBFC has 30 days to resolve and reply to a borrower complaint. You can find their contact details on the KFS or the app website. If you are unsatisfied with their response, you can learn how to complain to the RBI Ombudsman for further escalation.

If the app does not appear in the RBI directory or uses blackmail, you should file an illegal loan apps RBI complaint. The RBI Sachet portal is the official platform for reporting unauthorized digital lending platforms.

Keep your details ready before you file the complaint. You will need screenshots, transaction IDs, and the phone numbers used by recovery agents.

FAQs

Loan app fake hai ya real kaise pata kare?

Legal loan apps must disclose the name of their partner NBFC or bank in the app store description. You can check this NBFC name against the October 2026 RBI Digital Lending App Directory to see if it is real.

Can loan apps access my phone contacts?

No. Loan apps are prohibited from accessing a user's phone contact list, photo gallery, or call logs. If an app asks for these permissions, it is violating RBI rules.

What is the cooling-off period for digital loans?

Borrowers are entitled to a cooling-off period of at least one day for all digital loans under the 2025 RBI Digital Lending Directions. During this time, borrowers can return the principal and proportionate interest without paying a penalty.

Where to complain against harassment by loan apps?

You should first complain to the grievance redressal officer of the NBFC. If they do not reply within 30 days, or if the app does not appear in the RBI directory, you can report it on the RBI Sachet portal.

The short version

  • The RBI digital lending guidelines force loan apps to show the total cost of a loan upfront in a Key Fact Statement.
  • Digital loans must be transferred directly between the bank account of the regulated entity and the borrower.
  • Loan apps are prohibited from accessing a user's phone contact list, photo gallery, or call logs.
  • Borrowers get a cooling-off period of at least one day to return the loan without penalty.
  • You can report harassment or platforms that do not appear in the RBI directory on the RBI Sachet portal.

Sources

Disclaimer

Qrates is an information directory. It takes no commission from any company listed and does not recommend products. Figures are taken from the sources named and dated, and they change; check the company's own page before you decide. This is not investment, credit, insurance or tax advice for your situation. Borrow only from an RBI-regulated lender or its listed partner app.

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