The Reserve Bank of India (RBI) has finally published the final set of rules governing peer-to-peer (P2P) lending platforms, following its recent notification classifying such platforms as Non-Banking Financial Companies (NBFC).The Master Directions – Non-Banking Financial Company – Peer to Peer Lending (Reserve Bank) Directions, 2017 (Directions) is 22-page long, and contain 20 sections and 5 annexures.

The main provisions of the Directions at the outset provides for the eligibility criteria for being registered as a P2P Platform, with the minimum ‘net owned funds’ requirement kept at INR 20 million. Thereafter in the process for registration as an NBFC P2P, the RBI has listed some subjective criterion such as “the general character of the management of the company is not prejudicial to public interest” and the company has “adequate capital structure” to undertake this business. Disclosure requirements have been mandated on the platform; disclosures to the lenders, borrowers and public. The platform is also required to become a member of the Credit Information Companies and submit data to them periodically.

October 16th, 2017