RBI proposes rules for peer-to-peer lending; seeks to regulate sector with measures

Posted on:28 Apr 2016 18:12:27

RBI proposes rules for peer-to-peer lending; seeks to regulate sector with measures
28 April 2016 Current Affairs GK: The Reserve Bank of India for the first time proposed rules for peer-to-peer lending, seeking to regulate a growing sector with potential measures including requiring minimum capital of Rs 2 crore ($301,023.48) or prohibiting them from promising "extraordinary returns."

The RBI also proposed on Thursday (28 April) that only those defined as companies engage in peer-to-peer lending and said it may categorise firms in the growing sector as non-banking financial companies.

Peer-to-peer lending has been growing globally, including in India, where only a limited segment of the population has access to bank finance.The central bank sought feedback to its proposals from the public by May 31.

Peer-to-peer lending : Peer-to-peer lending, sometimes abbreviated P2P lending, is the practice oflending money to individuals or businesses through online services that match lenders directly with borrowers. Since the peer-to-peer lending companies offering these services operate entirely online, they can run with loweroverhead and provide the service more cheaply than traditional financial institutions. As a result, lenders often earn higher returns compared to savings and investment products offered by banks, while borrowers can borrow money at lower interest rates, even after the P2P lending company has taken a fee for providing the match-making platform and credit checking the borrower.Also known as crowdlending, many peer-to-peer loans are unsecuredpersonal loans, though some of the largest amounts are lent to businesses. Secured loans are sometimes offered by using luxury assets such as jewelry, watches, vintage cars, fine art, buildings, aircraft and other business assets as collateral. They are made to an individual, company or charity. Other forms of peer-to-peer lending include student loans, commercial and real estate loans, payday loans, as well as secured business loans, leasing and factoring.

Gk Current Affairs April 2017

25 APRIL
NEWS
24 APRIL
NEWS
22 APRIL
NEWS
21 APRIL
NEWS

Gk Current Affairs March 2017

31 MARCH
NEWS
30 MARCH
NEWS
29 MARCH
NEWS
28 MARCH
NEWS

Gk Current Affairs February 2017

28 FEBRUARY
NEWS
27 FEBRUARY
NEWS
25 FEBRUARY
NEWS
24 FEBRUARY
NEWS




Get Daily Current Affairs to your Email

You can Unsubscribe us at any time.

Get Daily Current Affairs to your Email

You can Unsubscribe us at any time.