Fintech startup Uni announced on Friday that it has suspended card services on its products in line with the Reserve Bank of India’s (RBI) recent notification regarding digital lending.
The startup said it is proactively suspending the Uni Pay 1/3rd Card and Uni Pay 1/2 Card services, which will impact millions of users.
“This process will begin in phases for our customers starting today and will be complete by Monday, August 22. While this is a decision made with a heavy heart, we are still committed to being compliant and want to be on the safe side of regulations,” the startup said in a statement.
What will work?
Investors like General Catalyst, Elevation Capital and Lightspeed Venture Partners back Uni Cards.
“Keeping in mind that the Uni card is used for urgent needs such as payment of expenses, medical bills and emergencies, we have ensured that each of our customers will have access to their line of credit through Uni Cash” , said Nitin Gupta, founder. and CEO, Uni Cards.
With a free partial limit enabled, “our customers won’t face any interruptions when using their funds,” he added.
The recent digital lending guidelines aim to create a solid framework that protects the interests of customers.
The framework is based on the principle that lending activities can only be carried out by entities that are either regulated by the central bank or entities authorized to do so under any other law.
(With contributions from IANS)