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Live Mint: Peer-to-peer lenders are now NBFCs This development means that P2P companies are now recognized by the Reserve Bank of India The Reserve Bank of India (RBI) said, through an 18 September gazette notification, that peer-to-peer lenders (P2P)-companies that provide loan facilitation services from their platform-will be treated as non-banking financial companies (NBFCs). You can read the notification here. While the regulator's detailed guidelines for this sector are still pending, this development means that P2P companies are now recognised by the banking regulator. You may have come across various P2P lenders that claim to give very high returns. Let us first understand what exactly is P2P lending and how it works.

All peer-to-peer lending (P2P) platforms would be treated as non-banking financial companies (NBFCs) and will be regulated by the Reserve Bank of India (RBI), according to a government of India notification released on Wednesday. Bhavin Patel, Co-Founder & Chief Executive Officer of LenDenClub, said: "This RBI regulation will bring much-needed legal clarity in the system, and lenders/platform will get legal rights to take adequate steps against defaulters. Also, regulation will mean wide acceptability of this concept among lenders as well as borrowers. This will fulfill RBI's expectation of taking P2P lending to the masses of this country." Source: Money Control