**Missed a Phone EMI? RBI May Soon Have the Power to Lock Your Device Remotely**
*By Akash Pandey | October 3, 2025, 6:11 PM*
The Reserve Bank of India (RBI) is considering a new rule that could allow banks and finance companies to remotely lock mobile phones purchased on Equated Monthly Installments (EMIs). This move, first reported by Reuters, aims to address the increasing problem of bad loans in India’s rapidly expanding consumer finance sector.
### Proposed Change to the Fair Practices Code
The RBI plans to revise its Fair Practices Code in the coming months to include this new provision. Under the proposed rule, lenders—including banks and non-banking financial companies (NBFCs)—would have the authority to remotely lock mobile phones bought on credit if a borrower misses an EMI payment.
### Why This Change? Tackling Rising Non-Performing Assets
India’s consumer loan market has witnessed significant growth recently, especially in small-ticket loans under ₹1 lakh. However, this surge has been accompanied by a rise in defaults. A 2024 study by Home Credit Finance highlighted a spike in EMI-based purchases of electronic devices, which are particularly vulnerable to missed payments. The RBI’s framework is designed to curb the growing number of non-performing assets (NPAs) in this sector.
### Privacy and Technical Guidelines
To ensure borrowers’ privacy and protect their data, the RBI is likely to mandate that lenders obtain prior consent before activating the remote locking feature. Additionally, strict guidelines will govern the technical process of locking devices. Importantly, lenders will not have access to any personal data stored on these phones.
### Potential Impact and Opposition
If implemented, this policy could impact millions of Indians who rely on EMIs to purchase mobile phones and other electronic devices. With over 1.16 billion mobile connections in India, smartphones are essential tools for work, education, and financial inclusion.
However, the proposed rule has met with strong opposition from consumer advocacy groups. Critics argue that remotely locking devices could unfairly penalize borrowers who depend on their smartphones for their livelihoods.
As the RBI consults stakeholders and finalizes its position, the coming months will be crucial in determining how this policy could reshape consumer lending and digital device ownership in India.
https://www.newsbytesapp.com/news/business/rbi-may-allow-banks-to-lock-phones-bought-on-emis/story
