KC Venugopal urges Centre to make loan app offences non-bailable, set up joint task force

Senior Congress leader KC Venugopal has written to Finance Minister Nirmala Sitharaman demanding urgent action against illegal digital lending apps .

His letter is a detailed blueprint for fighting the loan app menace. Let me break down exactly what he's demanding.

The Five Key Demands

Demand 1: Make Loan App Crimes Non-Bailable

Venugopal called for offences such as extortion, data theft, and online abuse linked to loan apps to be classified as serious non-bailable crimes .

What does this mean? Currently, someone arrested for loan app harassment might get bail quickly and continue operating. Non-bailable charges mean they stay in custody while the investigation continues – a serious deterrent.

Demand 2: Ban Apps from Accessing Personal Data

He demanded a strict ban on loan apps accessing users' personal data, including contacts and photo galleries .

This is the core of the predatory model. As I've explained before, a lender that needs your contacts is planning to use them against you. Venugopal wants to make this illegal.

Demand 3: Create a Joint Task Force

He proposed setting up a Joint Task Force comprising the Finance, IT, and Home Ministries to dismantle networks of illegal operators and freeze their bank accounts .

Currently, enforcement is fragmented. Different agencies handle different aspects. A joint task force would coordinate across ministries.

Demand 4: Force App Stores to List Only RBI-Approved Apps

Venugopal urged the government to direct tech companies to ensure that only RBI-approved lending apps are listed on platforms like the Google Play Store and Apple App Store .

This is critical. Currently, illegal apps can appear on official app stores alongside legitimate ones. Under this proposal, app stores would have to verify RBI approval before listing any lending app.

Demand 5: Ban Celebrity Endorsements of Loan Apps

He called for a ban on celebrities endorsing loan apps .

Why? Because celebrities lend credibility to predatory platforms. When you see a famous face promoting a loan app, you're more likely to trust it. Venugopal wants to remove that trust signal.

The Human Cost Driving These Demands

Venugopal cited specific cases, including the death of Nithin Raj, a BDS student in Kannur whose death was reportedly linked to threats from a loan app .

He noted that complaints against illegal loan apps in Kerala alone run into the thousands over the past few years. And critically, authorities acknowledge that only a fraction of these complaints translate into formal police cases .

What This Means for Borrowers

The fact that a senior political leader is making these demands at the national level is significant. It means the issue has moved beyond local police complaints to the national political agenda.

Expect legislation to follow. The question is not whether India will regulate loan apps more strictly, but how strictly and how soon.