Online Platforms Directed to Remove Ads of Fraudulent Loan Apps

An advisory recently issued by the Ministry of Electronics and Information Technology (MeitY) requires social media platforms to not host advertisements of fraudulent loan apps. The platforms are further directed to take additional measures to disallow advertisements of illegal loan and betting apps which may scam and mislead users. It is stated that the consequences would be the platforms’ sole responsibility. A week’s time has been given to platforms to adhere to the advisory.

The Minister of State for Electronics and Information Technology, Rajeev Chandrasekhar said that the Ministry has held discussions with the Ministry of Finance and the Reserve Bank of India (RBI) to address the mushrooming of fraudulent loan apps. He added that a “robust mechanism” for the same would be set up soon. Referring to due diligence requirements under provisions of the Information Technology (Intermediary Guidelines and Digital Media Ethics Code) Rules, 2021, the Minister highlighted that advertisements of fraudulent loan apps cannot be hosted by intermediaries and on failure to comply with the rules, the intermediaries stand to lose the protection accorded under the safe harbour clause.