Delhi High Court Seeks RBI's Response On Plea For Action Against NBFCs Violating Guidelines On Digital Lending

The Delhi High Court on Wednesday issued notice on a petition seeking coercive action against Regulated Entities (REs), Non-Banking Financial Companies (NBFCs) and Lending Service Providers (LSPs) operating digital lending applications found to be in breach of Reserve Bank of India's Guidelines on Digital Lending.

A division bench comprising Chief Justice DK Upadhyaya and Justice Tejas Karia sought response of Union Government, RBI, Google LLC and Apple India Private Limited.

The PIL has been filed by one Himakshi Bhargav, raising concerns regarding the violation of borrowers' fundamental right to privacy and data protection by NBFC backed Digital Lending Applications (DLAs) operating in India in breach of the guidelines.

“Despite the issuance of binding Reserve Bank of India Digital Lending Guidelines dated 08.05.2025, the Impugned Applications continue to access prohibited mobile phone resources such as contact lists and call logs, collect excessive personal and device-level data, and deploy coercive consent mechanisms,” the plea states.

The RBI Guidelines issued on May 08 last year expressly prohibits Digital Lending Applications from accessing mobile phone resources such as contact lists, call logs and telephony functions, and permit only limited one-time access to camera, microphone, or location strictly for onboarding and KYC purposes, subject to explicit consent.

It is Bhargav's case on examining multiple digital lending applications available on Google Play and Apple Store, it came to her knowledge that several NBFC-backed applications, including Slice, Branch, Navi, Home Credit, Simpl, Dhani, Refyne, ZestMoney, Freo Pay and LendingPlate, continue to access borrowers' contact lists and call logs, collect excessive data, and impose blanket consent conditions.

She has said that despite her detailed complaint to RBI, no enforcement action or public response has been taken and the Impugned Applications continue to operate on major app platforms.

The PIL seeks to cancel or suspend the licence of all impugned entities. A further direction is sought on RBI to disclose number of digital lending platforms found non-compliant, action taken reports (ATRs), and compliance reviews conducted since the issuance of the 2025 Guidelines.

The petitioner is represented through Advocates Kunal Madan, Manmay Sarawagi, Yugal Jain and Teena.

Title: HIMAKSHI BHARGAV v. UNION OF INDIA & ORS