Digital Lending Platforms and Consumer Protection: A Review of Regulatory Frameworks

The exponential growth of digital lending platforms has democratized access to credit, profoundly impacting financial inclusion globally. However, the pivot from traditional banking to technology-driven credit origination has introduced complex consumer protection risks, including data privacy violations, algorithmic bias, predatory pricing, and aggressive recovery tactics. This review critically examines the intersection of digital lending and consumer protection by analyzing the evolving regulatory frameworks across multiple jurisdictions. Drawing upon 20 recent academic and institutional studies, this article highlights the shift from reactive to proactive regulatory regimes, emphasizing the roles of enhanced disclosure, data localization, algorithmic accountability, and regulatory sandboxes. The paper concludes with policy recommendations for fostering a sustainable, borrower-centric digital credit ecosystem.