In order to boost the Peer-to-Peer (P2P) Lending business, Reserve Bank of India vide its notification no. DOR.NBFC(PD) CC.No.106/03.10.124/2019-20 dated 23rd December, 2019 has increased the limit of aggregate exposure of a lender to all the borrowers across all P2P platforms from INR 10 lakh to INR 50 lakh subject to the compliance with the following conditions-
- Minimum net worth of the lender shall be INR 50 lakh;
- Submission of a certificate of a Practising Chartered Accountant (PCA) certifying compliance with the provision of minimum net worth by the lender;
- Declaration by the lender declaring that they understand all the risks associated with the platform.
However, no change in the exposure of a borrower has been made, thus a borrower may borrow up to INR 10 lakh at any point of time, across all P2P platforms.
Further, in order to provide more flexibility in the operations of the platform, RBI has also relaxed the provisions of appointing trustee for escrow accounts and allowed that escrow accounts to be operated by a bank promoted trustee for transfer of funds need not to be mandatorily maintained with the bank which has promoted the trustee.