P2P platforms taking on the lender role led RBI to read the riot act

MUMBAI: The Reserve Bank of India’s (RBI) tightening of norms for P2P lenders comes after several of them were found to be having hundreds of crores of rupees in escrow accounts in violation of guidelines for the platform providers, said people familiar with the matter.

Many of the lenders were interpreting the regulations liberally to suit their lending practices, forcing the regulator to come up with norms that clearly state that they can’t assume the role of lending institutions, said those people familiar with the matter.