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Context

• The Reserve Bank of India (RBI) is contemplating the establishment of a Digital India Trust Agency (DIGITA) as a measure to combat the rising cyber fraud in the digital lending sector.

Purpose of DIGITA

• DIGITA aims to verify digital lending apps and maintain a public register of verified apps to prevent the proliferation of illegal lending apps.
• Apps lacking the 'verified' signature of DIGITA would be deemed unauthorized for law enforcement purposes, acting as a crucial checkpoint against financial crimes in the digital domain.

Responsibilities of DIGITA

• Once established, DIGITA will be responsible for vetting digital lending apps to ensure compliance with regulatory standards.

Need for Transparency and Accountability

• A thorough verification process by DIGITA is expected to promote transparency and accountability within the digital lending sector, which has witnessed a surge in fraudulent activities.

Collaboration with IT Ministry and Google

• The RBI has shared a list of 442 unique digital lending apps with the IT Ministry to whitelist with Google.
• Google has removed over 2,200 digital lending apps from its app store between September 2022 to August 2023.
• Google's policy update allows only apps published by RBI-regulated entities or those in partnership with such entities, following requests from the RBI and the Department of Financial Services.

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