RBI Urges Caution Over Misleading Loan Waiver Campaigns

The Reserve Bank of India has issued a fresh warning over unauthorised campaigns claiming to offer loan waivers, as per the PTI reports.  

The central bank said such activities continue to surface across media channels and through direct contact with borrowers, despite earlier advisories.  

The warning reiterates concerns first highlighted in December 2023, indicating that these practices remain widespread. 

False Promises and Fee Collection 

According to the regulator, these campaigns typically involve assurances of settling or waiving outstanding loans from banks and non-banking financial companies (NBFCs). In several cases, individuals are offered documents described as “debt waiver certificates”. 

Borrowers are also asked to pay charges under different heads, including legal or service fees. These payments are collected without any formal backing or approval from regulated institutions. 

Risks to Borrowers and Institutions 

The central bank said such schemes mislead borrowers and can interfere with the normal functioning of the credit system. By creating false expectations around loan relief, they may affect repayment behaviour. 

It also noted that these activities could impact financial institutions and depositors. Any disruption in repayments or trust within the system can have implications. 

Legal Position and Enforcement 

The regulator clarified that claims made by such individuals or entities are false and misleading. It added that these actions may attract legal proceedings under applicable laws. 

Those engaging with such operators may face financial losses, as payments made do not lead to any legitimate change in loan obligations. 

Advisory to the Public 

Borrowers have been asked to avoid dealing with such entities and instead contact their respective banks or NBFCs directly for any loan-related queries. The central bank has also advised reporting such cases to law enforcement agencies. 

Read More: Auto Sector Faces ₹25,000 Crore Profit Hit on End-of-Life Vehicle Rules! 

Conclusion 

The advisory underlines that loan-related decisions should be based on verified information from regulated lenders, with no provision for third-party waiver schemes. 

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