After the outbreak of the Covid-19 pandemic, many people faced job losses or wage cuts as businesses took a hit. Transitioning to a lower pay scale overnight is almost impossible and terrible. Many people have turned to borrowing to meet the most basic requirements.
To make ends meet, millions of Indians are downloading quick loan apps. Cybercriminals take the opportunity to invent new techniques to defraud mobile phone and computer users. With so many fintech companies ready to offer small loans, borrowers risk getting lost and falling for fraudulent loan applications offering instant credit online.
As these numbers continue to rise, awareness of how to identify genuine fintech lenders has become crucial.
Here are some tips that will help you determine the legitimacy of loan applications:
Check the credentials: A borrower should verify the credentials of the lender and only work with an RBI registered lender, be it a bank or an NBFC. Ratings and reviews are important; when choosing a lender, it is a good idea to look at ratings and reviews. This will give the borrower a good idea of ââhow the lender is operating, and any unethical behavior on the part of the lender will be reported by previous borrowers.
Access to personal data: Some loan apps require gallery and contact access to complete subscription and authenticity checks. Responsible lenders keep this information confidential and avoid disclosing it to third parties at all costs. In today’s environment, lenders have become very proficient in terms of underwriting systems and adhering to controlled collection processes. This eliminates their dependence on contact lists or gallery access, thus putting an end to any fraudulent activity. Additionally, responsible digital lenders protect their data by performing information security audits and regularly monitoring AI functionality. Awareness is your best defense. Do your due diligence.
The lender’s website is not secure: When you visit a lender’s website, look for a padlock icon on any pages where you are asked for personal information. HTTP: // websites are secure because they are protected from identity thieves who steal personal information and sell it to others. A reputable lender will protect you from loan scams by ensuring that your data is secure and will not leave your information accessible to others.
Physical address: The app / fintech that you plan to borrow a loan from must have a physical address. If you can’t find a legitimate physical address, you should avoid the loan. Many crooks prefer to remain anonymous in order to avoid legal repercussions.
Initial costs: Many small lenders charge an initial application fee or membership fee ranging from Rs. 100 to Rs. 400 on their applications. Once the borrower provides the fees, they are redirected to other applications where they can apply. Since many of the smaller loan applications do not have a website or are even licensed, they work with other larger lenders. Keep this in mind before you focus on the lender.
Google Play Store Standards: Google Play Store does not allow apps that offer loans with terms of less than 60 days. Beware of small entities and protect yourself from fraudulent loan companies.
While loan applications can be a fantastic way to get a loan fast, it is essential to protect yourself against many fraudulent fintech loan applications. It is also important in these times to be finance and digital aware in order to avoid illegal lenders and only borrow from sources registered by the RBI.
by, Madhusudan Ekambaram, co-founder and CEO, KreditBee and co-founder of FACE