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Daybreak · July 10 · 24 min

Miss a smartphone EMI, and your lender can now wirelessly strip the ‘smart’ out of it

Naresh drives for Rapido. When his phone died, so did his income — for seven days, until he could borrow enough to replace it. Until 2024, India's biggest consumer lenders had turned that exact vulnerability into a recovery tool. Miss an EMI, lose your phone. It worked so well that smartphone lending grew from 1% to nearly 40% of consumer borrowing in three years. Then the RBI banned it. Lending collapsed by 80%. Delinquencies rose. Rejection rates hit 50%. Now the tool is coming back. This time with guardrails. The question is whether they're enough. *We want to get to know you a little better. Tell us what you think about Daybreak here. Daybreak is produced from the newsroom of The Ken, India’s first subscriber-only business news platform. Subscribe for more exclusive, deeply-reported, and analytical business stories.

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Naresh drives for Rapido. When his phone died, so did his income — for seven days, until he could borrow enough to replace it.

Until 2024, India's biggest consumer lenders had turned that exact vulnerability into a recovery tool. Miss an EMI, lose your phone. It worked so well that smartphone lending grew from 1% to nearly 40% of consumer borrowing in three years. 

Then the RBI banned it. 

Lending collapsed by 80%. Delinquencies rose. Rejection rates hit 50%.

Now the tool is coming back. This time with guardrails. The question is whether they're enough.

*We want to get to know you a little better. Tell us what you think about Daybreak here.

Daybreak is produced from the newsroom of The Ken, India’s first subscriber-only business news platform. Subscribe for more exclusive, deeply-reported, and analytical business stories.

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