What must a digital lender disclose in the Key Fact Statement before I take a loan?

Question

I am considering a loan from a digital lending platform and want to know what mandatory disclosures RBI requires before I agree to the terms. I have been reading conflicting things online and I would like to understand what Indian law actually says about this, which Act and Section applies, what the realistic timelines and costs are, and what I should be doing right now to protect my position. If the matter can be resolved without litigation I would prefer that route, but I want to know what my rights are before I agree to anything or sign any document.

MyVakeel Legal Desk · Accepted Answer

What must a digital lender disclose in the Key Fact Statement before I take a loan? is governed in India primarily by RBI Guidelines on Digital Lending 2022 and RBI Master Direction on Digital Lending 2025. The short answer is set out below, followed by the practical steps most people in this situation need to take. Read it alongside the specific provisions named, because the exact relief available to you turns on the facts you can prove on paper.

The Key Fact Statement must disclose the Annual Percentage Rate, total cost of the loan, and a clear break-up of all fees including processing fees, insurance premium and other charges.

It must specify the repayment schedule, penal charges for late payment, and details of the cooling-off period during which the borrower can exit the loan by paying principal and proportionate APR.

Digital lenders must provide the name of the regulated entity actually disbursing the loan, since many apps operate as loan service providers on behalf of NBFCs or banks.

Grievance redressal officer details and the applicable regulator's contact information must be part of the disclosures for the borrower's recourse.

Failure to provide a compliant Key Fact Statement can be treated as an unfair practice and reported to RBI or the underlying regulated entity's board.

What to do next: 1) Request the Key Fact Statement in writing before accepting any digital loan offer; 2) Compare the disclosed APR and charges against the amount actually being disbursed and recovered; 3) Exercise the cooling-off period option if the terms turn out to be unfavourable after signing; 4) Complain to the RBI-regulated NBFC or bank named in the KFS if disclosures are missing or misleading.

If the other side has already issued a notice, filed a case or set a deadline, treat the matter as time-sensitive — most remedies under RBI Guidelines on Digital Lending 2022 carry limitation periods, and a delay you cannot explain weakens an otherwise strong case. 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 this practice area.