Introducing Credit Counselling & Pushing Back Against KYC Harassment
 
Dear Moneylifers,
 
Over the past few months, we’ve seen something deeply worrying at Moneylife Foundation—an unmistakable surge in distress messages from people weighed down by debt. Whether it’s credit cards, buy-now-pay-later apps or multiple unsecured loans, we’re hearing from individuals whose monthly repayments exceed their income, leaving them feeling hopeless and cornered.
 
Many of these messages have a common thread—people want to pay, they want to do the right thing, but they’re overwhelmed. Unfortunately for some, when they seek help, they’re often met with rejection or worse—harassment from recovery agents. In the absence of institutional support or meaningful credit counselling, these individuals are left to fend for themselves in a highly predatory lending environment. This is not just an individual crisis—it’s a systemic one.
 

 
Introducing Our Credit Counselling Clinic – First Session Free
 
To offer structured support, we’re launching a fortnightly online credit counselling session starting Friday, June 6, 2025, from 4:00pm to 6:00pm, over Zoom. We’re privileged to have Aparna Ramachandra, founder-director of Rectify Credit, lead these sessions. Aparna has years of experience guiding people out of debt traps with practical, personalised advice and we are confident she’ll make a real difference to those who need help the most.
 
These sessions are appointment-based and participants will be required to share their credit report and relevant documents in advance. Also, only the first session is free, further help and guidance will depend on the complexity of the case and would be at the discretion of the counsellor.
 
If you or someone you know is struggling with loans, please don’t hesitate to reach out. For appointments, please send a mail to [email protected] along with your latest credit report, any relevant documents pertaining to the loans and a concise summary of your present financial situation.
 

 
KYC is Hurting the Most Vulnerable
 
Over the past few months, we have spent a lot of time digging into the chaos caused by KYC norms—especially in rural India. I’m pleased to share that Moneylife Foundation has published a detailed study titled “KYC is Torture: Rural Realities and Reforms” which confirms just how broken the system really is.
 
What we found is shocking: accounts are being frozen for minor mismatches in documents, people are being denied access to pensions or wages and banks continue to behave as though they have a free hand—even when RBI regulations say otherwise. There’s no real system in place, no standard procedure. Just confusion, harassment and endless red tape—mostly for the poorest and most vulnerable. This study puts all the pieces together—data, lived experiences and regulatory analysis—and suggests practical reforms. If you care about financial justice, I urge you to read it.
 
Also, here’s something important: RBI is currently seeking feedback on its draft circular on Updation/ Periodic Updation of KYC – Revised Instructions. If you or someone you know has faced KYC-related issues, this is your chance to speak up. The deadline for submission is June 6th, so do make use of this opportunity to push for real change and submit your feedback here: https://www.rbi.org.in/scripts/Bs_Connect2Regulate.aspx
 
 
Additionally, you may also want to read my recent article on Moneylife - RBI's Draft KYC Proposals: More Tinkering, Still No Teeth, where I have critically examine RBI’s latest draft circular on KYC. The article highlights the lack of enforceable guidelines and accountability measures in the proposed changes, emphasising the need for more substantial reforms to protect consumers from arbitrary account freezes and other hardships.
 

 
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Check our Free Helplines and Guides or Templates as well as our YouTube Channel, where you will find a wide repository of videos on various topics.
 
Video recordings of all our webinars are available on our YouTube channel and will come to your inbox regularly if you hit the subscribe button. But if you want to be notified about future events through our mailing list, you do need to be a member.
 

 
Moneylife TV & Helplines
 
Financial Literacy Videos in Indian Languages:
  1. Credit cards
  2. Online frauds
  3. Fallacy of gold loans and more in Marathi, Gujarati, Punjabi and Tamil, all on our YouTube channel (https://www.youtube.com/moneylifetv).
 
Get guidance and counselling through our Legal Helpline or Credit Helpline.
 
Sucheta Dalal
Founder-Trustee, Moneylife Foundation
 
 
Trustees: Walter Vieira, Sucheta Dalal, Debashis Basu.
 
Moneylife Foundation is registered with the Charity Commissioner of Mumbai, is an Affiliate member of OECD's International Network on Financial Education, is a Supporter Member of Consumers International, Development Partner of Advocates for International Development (A4ID), and is a winner of the 10th MR Pai Memorial Award.
 
 
Donations are eligible for tax benefits under Sec 80G of the Income Tax 1961 (50% tax exemption) and MLF is registered under the Foreign Contribution (Regulation) Act, 2010.

80(G) Reg No: DIT(E)/MC/80G/685/2010-11 dated 7.2.11 effective 8.+9.2010 | FCRA Registration No: 08378138