Many digital loan apps are chasing desperate borrowers
In recent years, an increase has been observed in financial fraud involving illegal digital loan applications.
The modus operandi of such apps is to lure vulnerable customers by providing instant loans through a simple process and with a minimum of paperwork.
However, the interest for these loans is kept too high, which means that many cannot repay them. Once the borrower fails to repay the loan, the collection agents often resort to intimidation and blackmail, which has driven people to suicide in several cases.
Many digital loan apps thrive illegally in app stores preying on desperate borrowers.
The Reserve Bank of India (RBI) has also taken note of the matter and plans to establish a safe list of all legal online lending apps that are allowed to work.
However, it is always advised to remain cautious so that you do not fall prey to a fraudulent online financial platform.
Before using a loan app, keep the following points in mind to avoid falling victim to financial fraud:
- It has been found that once you install these pirated applications, they request access to your personal data such as contact list, photo gallery and camera. So always avoid applications that you think could compromise the security and privacy of your personal information.
- If you have any doubts about the authenticity of a loan app, always go to a well-known bank or financial company to secure a loan. The RBI maintains a list of all non-bank financial companies (NBFCs) from which you can safely apply for a loan.
- One should also avoid clicking on suspicious links attached to emails and messages promising immediate loans with lucrative offers.
- Such links are often malicious and can infect your system with viruses or spyware that in turn steal personal information. The data can then be used by fraudsters to threaten or blackmail you.
- Never download a digital app from reliable sources such as Google Playstore or the App Store (for iPhones). Before downloading any finance app, always verify the details and go through the reviews shared by the users.
