Loan Fraud Type 2 (Instant loan Apps)

Are you trying to get instant loan through loan apps?

this is for you. Read carefully. Karan (Changed name) was trying to get a small amount instant loan for some reason. Scrolling through hundreds of options, he came across a mobile application (App), which offered him some lucrative money-lending options.

Unfortunately, it was a fraudulent mobile loan application, which asked Karan to enter his mobile number, bank account number, PAN and Aadhar details to get approval for a Rs 9,000 instant loan.

To his surprise, the amount was immediately credited to his bank account. Karan was confused at the superfast transaction from the money lending application, which alerted him to read the minute details and terms and conditions of the loan. Upon closely checking the repayment details, he was shocked that his loan amount, which had an interest component of a staggering 80 per cent, was due for repayment within the next 10 days.

And then his worst nightmare started. He started getting calls from various numbers, saying that if he refuses to pay back the money, he will get into various troubles, his bank account would be hacked. The scammers got access to his email contacts and phone numbers, his photos and videos, who then threatened to expose his personal details. Karan’s fake social media account was created where the scammers started demanding money from his contacts. Even his wife started getting threatening calls.

Fearing worse, Karan approached the cyber cell of police. But police refused to file any case, saying that since he was getting calls from various numbers it was difficult to file the case. He was asked to shut his bank account, change his mobile number and alert his close contacts not to respond to any “emergency situation” related to him. Though Karan did manage to come out to salvage the situation, his entire social, personal and financial life were messed up.

Today thousands of individuals like Karan get scammed from online money lending applications and fake calls. Though the government has no data so far on this mobile application financial fraud, the situation is alarming. Recently a Chinese loan app fraud, which resulted in extortion and harassment of many across India had created stir. From Mumbai to Delhi, West Bengal, Bangalore, Lucknow and Hyderabad, daily news reports related to mobile app loan frauds have become the order of the day.

How online fake loan apps works

1) Victims apply for loans on SMS, WhatsApp messages or social media.

2) They download the DMZ/APK files and install fake loan apps.

3) These applications seek access to contacts, galleries and GPS locations for loan to be allowed.

4) Once allowed access, all personal details are uploaded on their servers.

5) Victims upload all proof of documents and access to their cell phones, and the credit reimbursement span is normally between 7-15 days.

6) If Rs.10000 is the loan amount and only Rs.5500 is released and the rest is deducted as processing, GST, and other fees.

7) If the loan is not paid at the specified time, harassment starts with callling to contact list or WhatsApp groups with friends and family members and defamatory messages.

8) Once the victim is frightened and liable to pay and doesn't have cash, they then provide loans from alternative apps, and the vicious circle continues as the victim is forced to withdraw the money to pay for the older loans.

Before using any loan app, consider the following points not to become a victim of any financial fraud:

• It has been seen that once you install these illegal applications, they request access to your personal data such as contact list, photo gallery, and camera. So, always avoid applications that you feel can compromise the safety and privacy of your personal data.

• If you are doubtful about the authenticity of any loan app, always go to a known bank or financial company to secure a loan. The RBI maintains a list of all the Non-Banking Financial Companies (NBFCs) from which you can safely seek a loan.

• One must also avoid clicking suspicious links attached to emails and messages that promise instant 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 any digital app from reliable sources like Google Playstore or the App store (for iPhones). Before downloading any financial app, always verify details and go through the reviews shared by the users.

Thank You

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