What can I do if a digital lending app harasses me for loan recovery?

Question

A loan app I borrowed a small amount from is calling my contacts, sending abusive messages and threatening me even though I only missed one due date. What protection do I have under RBI's digital lending rules? Before I spend money on it, I want to know whether RBI Digital Lending Guidelines 2022 gives me a remedy here and what proof I would need. Any Section numbers I can quote when I write to them would be useful.

MyVakeel Legal Desk · Accepted Answer

RBI Digital Lending Guidelines 2022, Reserve Bank of India Act 1934, Section 45-IA, Information Technology Act 2000, Section 66E and Indian Penal Code 1860, Section 507 is what decides this question in India. Read it alongside the provisions named, because the relief available to you turns on the facts you can prove on paper.

The RBI Digital Lending Guidelines 2022 mandate that recovery agents of regulated entities and their Lending Service Providers cannot contact the borrower's contact list, use threatening language or call outside 8 am to 7 pm.

Every digital loan must be routed through a bank or NBFC regulated by the RBI under Section 45-IA of the RBI Act, and unregulated apps operating outside this framework are themselves acting illegally.

Accessing a borrower's phone contacts or photos without explicit consent, and circulating them, can amount to an offence under Section 66E of the Information Technology Act 2000 for violation of privacy.

Criminal intimidation of the borrower or family members through threats of harm or reputational damage is punishable under Section 507 of the Indian Penal Code 1860 for anonymous criminal intimidation.

The RBI requires the regulated entity to be accountable for its outsourced recovery agents' conduct, so the borrower can hold the bank or NBFC responsible even if the harassment came from a third-party app or agency.

In practice, in this order: 1) Save screenshots, call recordings and messages as evidence of the harassment and threats; 2) File a written complaint with the regulated entity's grievance redressal officer and, if unresolved, escalate to the RBI Ombudsman; 3) Lodge a complaint with the local cyber crime cell or police station citing the specific IT Act and IPC provisions; 4) Report the app to the RBI and the app store if it is not listed as a registered digital lending app.

Timing matters here: RBI Digital Lending Guidelines 2022 works on limitation periods, so a digital lending app harassment claim that is right on the merits can still fail if it is brought late. You can post the details on the MyVakeel forum for a practising advocate to review, or book a paid consultation with a Bar Council verified lawyer in banking law.