Reserve Bank of India (RBI) has once again cautioned borrowers against falling for fraudulent campaigns that falsely promise loan waivers, warning that such schemes can lead to financial loss and disrupt the country’s credit system.
In
a fresh advisory, the central bank says it continues to receive reports of individuals and entities promoting misleading offers through social media, advertisements and direct outreach, claiming they can get loans written off for a fee. RBI stressed that such claims are false and may attract legal action.
The warning builds on a similar alert issued in December 2023, when the central bank had flagged the emergence of campaigns targeting borrowers with promises of debt relief. Despite that caution, RBI noted that such activities have persisted.
According to the regulator, these schemes, typically, involve false assurances of settling or waiving outstanding loans from banks or non-banking financial companies. In many cases, unsuspecting borrowers are issued so-called 'debt waiver certificates' or similar documents that have no legal validity. Fraudsters often collect money under the guise of service or legal charges, leaving victims with both unpaid loans and additional losses.
RBI emphasised that no unauthorised individual or private entity has the power to waive loans on behalf of regulated financial institutions. Any such representation, it says, is misleading and intended to exploit borrowers who may already be under financial stress.
The central bank also highlighted broader risks, noting that such campaigns interfere with the normal functioning of the credit system. By encouraging borrowers to believe that repayment obligations can be avoided, these schemes undermine financial discipline and can ultimately affect the stability of banks and non-banking lenders, as well as the interests of depositors, RBI says.
The regulator has urged members of the public to avoid engaging with such entities and instead directly approach their respective banks or lenders for any loan-related queries or restructuring options. It also advised borrowers to report suspicious campaigns to law enforcement agencies without delay.
In its earlier warning, RBI had pointed out that such fraudulent operators actively use print and digital platforms to lure borrowers, often misrepresenting that loans need not be repaid at all. The central bank had then cautioned that associating with such entities could result in direct financial losses.
The regulator reiterated that legitimate loan relief measures, if any, are always implemented through authorised channels and not through third-party agents or intermediaries.
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