Google is under pressure in India to fight illegal loaner apps: report


Google is also beginning to act in response to complaints from industry associations.


Google of Alphabet Inc has been asked by the government and the central bank to introduce stricter controls to curb the use of illegal digital credit applications in India, sources said.

While Google is not within the purview of the Reserve Bank of India (RBI), the US tech giant has been called to central bank and government meetings several times in recent months and pushed for stricter checks and balances that could help remove such apps, according to four sources.

Regulators have already asked lenders to step up controls on illegal credit apps, which became popular during the pandemic. Regulators are trying to control the proliferation of such apps that engage in unscrupulous activities such as charging excessive interest rates and fees or in recovery practices that are not authorized by the central bank or that violate money laundering and other government guidelines.

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Google said last year that it has revised its Play Store developer program policies for financial services apps, including mandating additional requirements for personal loan apps effective September 2021.

“We have removed more than 2,000 personal loan apps targeting India from the Play Store for violations of Play policy requirements,” said a Google spokesperson, adding that such steps will be taken if the policy is violated.

“We will continue to work with law enforcement agencies and industry associations to address this issue,” the spokesperson added.

While the central bank requires all lending apps listed in app stores to be supported by regulated entities, it’s up to Google to enforce and verify compliance.

Google has also been asked to look at curbing the rise of such apps through other distribution channels such as websites and other download means, according to another industry source directly involved.

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Google is also beginning to act in response to complaints from industry associations.

“Previously, Google would not respond to complaints about individual apps. Now they are more proactive and look into it when a complaint is made to them,” said one of four industry sources directly involved in the case who has been briefed on the matter. discussions with Google.

The government and the RBI are in the process of establishing a whitelist of approved credit applications. The central bank has also set standards to ensure that a borrower has to deal directly with a lending and collection bank, which can help keep the outside collection agents away.

Google dominates the app market with 95% of smartphones using its Android platform.

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The Department of Electronics and Information Technology and the RBI did not immediately respond to an email request for comment.


The digital lending market has grown rapidly, facilitating $2.2 billion in digital loans in 2021-22. It’s not clear how much of that is through apps that engage in illegal practices.

These lenders often reach customers through advertisements on platforms such as Facebook and Google.

Starting next month, Google will roll out a new advertising policy for financial services in India, according to a blog post on its website.

According to the policy, advertisers in the country must be verified to run advertisements for financial services in India. As part of the verification, advertisers must demonstrate that they are licensed with the relevant financial services regulator, the blog said.



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