🧨 RBI Fines Lendbox ₹40 Lakh — For Playing Fast & Loose With P2P Rules Like a Fintech Dhoni
📅 Published on: May 23, 2025 ✍️ By: Prashant Marathe
🎯 At a Glance:
RBI just dropped a ₹40 lakh regulatory mic drop on Lendbox, the Peer-to-Peer lending platform run by Transactree Technologies Pvt Ltd.
The crime?
Using a “co-lending escrow account” like it’s some shady Swiss locker
Not telling lenders what kind of loan zombies they were funding
Disbursing loans without asking the lenders first (kya democracy hai bhai!)
Result? ₹40 lakh penalty slapped under RBI Act — because apparently, this fintech thought they were still in 2017, when “move fast and break things” was cool.
🧾 What Did Lendbox Do Wrong?
RBI’s scrutiny (done in September 2023) revealed the following P2P sins:
Violation
Description
🚫 Escrow Escapades
Loan money was routed through a “co-lending escrow account” — a big no-no under RBI’s Fund Transfer Mechanism
🙈 No Risk Disclosure
Lenders were not shown the credit profile of borrowers — like Tinder without photos
🧟 Loans Without Consent
Loans were given to borrowers without lenders’ explicit approvals — because consent is apparently optional in fintech too?
The conclusion: Total P2P anarchy disguised as innovation.
🤓 What Is Lendbox Anyway?
Lendbox = One of India’s early P2P lending startups, promising “high returns” by connecting lenders directly to borrowers. Think of it as a Tinder for loans, but instead of swiping right, you get EMIs.
But clearly someone at Lendbox mistook RBI rules for terms & conditions no one reads.
📜 RBI’s Legal Response
Penalty was imposed under:
Section 58G(1)(b)
Section 58B(5)(aa) of the RBI Act, 1934
In plain English:
“You broke the rules. Now pay ₹40 lakh and sit in the corner.”
RBI also clarified that this does not affect the legitimacy of any loan agreement with customers. The penalty is strictly for compliance failure.
