The Reserve Bank of India (RBI) has mandated that lenders provide the Key Fact Statement (KFS) in a language understood by the borrower. Lenders must explain the contents of the KFS to the borrower and obtain an acknowledgment confirming their understanding. 

The KFS includes essential details such as the loan amount, interest rate, processing fees, repayment schedule, and grievance redressal mechanisms. Ensuring that this information is presented in a language familiar to the borrower helps them make informed decisions and promotes responsible lending. 

Lenders are advised to maintain multi-language KFS kits or create separate KFS documents for each vernacular language to ensure compliance with this requirement. Additionally, for digital KFS processes, the entire interface – including buttons and communication – must be in the borrower’s chosen language.

This mandate is part of the RBI’s broader initiative to promote fair lending practices and protect borrowers from potential misunderstandings or hidden charges. By providing the KFS in local languages, the RBI seeks to make loan information more accessible and comprehensible to a diverse population.