27th December 2020

Instant loan apps case

Recently, a woman employee of Telangana Agriculture Department and a software engineer died by suicide after they were humiliated and blackmailed by tele-callers and recovery agents of a mobile app instant loan company.

  • It is a racket in which instant personal loans are offered through mobile apps at exorbitant interest rates by unauthorised lenders.
  • It is highlighted that most of the instant loan apps do not have any tie-up with any bank or Non-Banking Financial Institution.
  • The rate of interest offered by instant loan apps is as high as per cent with exorbitant fees.
  • A few of the apps named by the police include Cash Mama, Loan Zone, Dhana Dhan, Cash Era, Cash Lion, Mastermelon, Lucky Wallet and Coco Cash.

What is the modus operandi of Mobile Apps involved?

  • After a customer downloads an app and uploads the documents demanded, the loan amount is credited into the bank account.
  • The phone numbers of the customer as well as numbers of his family members are shared by the app company with others.
  • The customers have end up borrowing more to repay a previous instant loan and got caught up in a vicious cycle of debt trap.

Precautions to be taken against Instant Loan Apps

  • The individual should not trust any app or platform that is not approved by RBI.
  • The borrowers should not panic and reach out to the concerned authorities whenever he/she is being threatened by the lender.
  • The RBI has also cautioned individuals and small businesses against falling prey to unauthorised digital lending platforms and mobile apps that promised hassle-free loans.

 

President Assent to State Bills

Recently, the Chief Minister of Rajasthan has said the Amendment Bills passed in the State Assembly to counter the Centre’s farm laws were held up in Raj Bhavan, as the Governor was not sending them for Presidential assent.

Powers assigned to Governor regarding State Bills

  • Article 200 of the Indian Constitution provides provisions regarding the powers of the Governor when a bill is passed by the state legislature.
  • The Governor shall declare either that he assents to the Bill or that he withholds assent therefrom or that he reserves the Bill for the consideration of the President.
  • When a bill other than money bill is presented before Governor for his assent, he either gives assent to the bill, withhold his assent to the bill or return the bill for reconsideration of houses.
    • If the bill is passed again by state legislature with or without amendments, he has to give his assent or reserve the bill for consideration of President.
  • The Governor cannot send money bill back for reconsideration because the money bill would usually be introduced with prior assent of Governor only.
    • In case the money bill reserved for Presidents assent, the President has to state whether he is giving assent or withholding his assent.
  • The Constitution does not furnish any guidance to the Governor that in which matters he should accord his assent and in which matters he should withhold assent.

Options for President on Bills reserved by Governor

  • When a bill passed by a state legislature is reserved by the governor for consideration of the President, the President can:
    • Give his assent to the bill, or
    • Withhold his assent to the bill, or
    • Direct the governor to return the bill (if it is not a money bill) for reconsideration of the state legislature.
  • It should be noted here that it is not obligatory for the President to give his assent even if the bill is again passed by the state legislature and sent again to him for his consideration.
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