Bought a phone on EMI? Now don't miss the installment by mistake, otherwise your device will be locked, know what this new rule is

October 05, 2025 ABP Live

Phone on EMI: India is one of the largest smartphone markets in the world today. Here millions of people are buying new phones in every budget segment, a large number of which are of users who take smartphones on EMI i.e. easy installments. Companies also offer attractive discounts on these schemes, but due to this, the risk of increasing outstanding loans (Bad Loans) has also increased. Now the Reserve Bank of India (RBI) is preparing to bring a new rule that will allow the phones of those who do not pay EMIs to be locked remotely.

What is the RBI's new proposal?

Why was this rule deemed necessary

This step of the RBI is being taken to control the rising non-performing assets (NPAs). In India, small loans, especially consumer loans of less than Rs 1 lakh, are increasing rapidly and their defaults have also increased. According to the 2024 Home Credit Finance report, there has been a sharp jump in EMI sales of electronic items and there has also been an increase in their default cases. In such a situation, this policy will give protection to the lenders so that they do not hesitate to give loans even to customers with low credit score.

How will the new system

RBI will amend its Fair Practices Code to decide how phone locking technology will work. It will be mandatory to take prior consent of the customers before giving the loan. Banks or NBFCs will not be able to access the personal data of the customer's phone in any case. The locking feature will be limited to deactivating the phone only, the data will be safe. In this way, the system will be implemented as a balanced and transparent process.

How long can this rule come

RBI had barred loan companies from using such locking apps in 2024 as there were complaints of their misuse in some cases. But now, after new discussions and consultations, the RBI is planning to bring it back again, this time with stringent safety rules. Although the official announcement has not been made yet, it is expected that this policy can be implemented in the coming months.