borrowers It is often difficult to know exactly Cost of one loan And often feel that there are few”hidden surprises,
“Currently, banks disclose all charge On a term sheet. However, a common borrower does not always read four-five pages of terms and conditions, so we have already made this document mandatory in microfinance and digital lending. RBI Governor Shaktikanta Das said, we are now asking this from all lenders.
The move is in line with RBI’s commitment to promote greater transparency and disclosure, thereby ensuring that consumers have the information they need to make informed decisions. With advance disclosure of charges associated with loans, consumers can better understand the real cost of borrowing, especially in the case of some short-term low value loans where the expense on charges is almost equal to the interest rates.