RBI raises concerns over fintech vehicle loan practices in India

The Reserve Bank of India (RBI) has raised concerns about fintech companies aggressively lending to first-time buyers of used vehicles. The regulator is worried that high loan-to-value ratios and excessive top-up loans are increasing borrower risk and affecting lender balance sheets. In recent months, the RBI has taken action against several fintech lenders for not complying with regulations. This includes a ban on Navi Finserv and others, which was lifted last week. The RBI has noted high delinquency rates among fintech lenders, particularly in personal loans. The RBI's scrutiny comes as fintech loans for used vehicles have increased, with total disbursements reaching ₹37,676 crore by June 2025. However, less than 10% of these loans were for first-time buyers, highlighting the regulator's focus on protecting vulnerable borrowers.