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

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 would rather settle this without going to court if the law allows it, but I need to know my rights before I sign anything. Please tell me what to do first and what document to keep.

Under Indian law, RBI Guidelines on Digital Lending 2022 is the starting point for this banking law question. What follows is the position in substance, together with the steps that usually make the difference in practice.

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 this means for you: 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.

Where the facts are disputed, what usually decides a key fact statement matter is the paper trail — dated complaints, acknowledgments and written replies under RBI Guidelines on Digital Lending 2022. 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.

Disclaimer: This information is for general awareness and does not constitute legal advice. Statutes and their interpretation change, and outcomes depend on the facts of your case. Please consult a qualified advocate before acting on it.