Unregulated to Regulated, path ahead
We have large low income population with limited access to traditional banking facilities like deposits and loans. Which means saving their hard earned money and availability of quick credit are missing. These are the same people who get attracted to ponzi schemes for higher returns or get them self entangled in circle of debt. Multiple moneylender laws were enacted to deter such scams. However failure to replace the role of money lenders gave rise to scams such as the saradha scam. The latest law to ban Unregulated deposit schemes is another step to stop such scams from happening. With this latest law, hand loans and many other loans become illegal as they are not regulated unless it is between relatives. While we still debate about the law, let us discuss about the alternatives for such non regulated loans. Recently RBI has created a new entity called NBFC-P2P. These NBFC companies play the role of mediator in between lenders and borrowers to facilitate the process of lo...