Despite RBI restrictions, lending apps continue their dirty games of instant loans - Full report!

The Reserve Bank of India (RBI) had issued rules against extortion of fake loan app companies in June 2020. Later a working group was also formed on the same matter, whose draft report has been received but the final rule is yet to come. Despite this, the dirty game of instant loan continues. The number is increasing significantly. Zee media report.

How do these fake apps gives instant loan?
To provide a loan, these apps ask for a copy of 3 months bank statement, a photocopy of aadhar card, and a PAN card from the customer. After receiving the documents, they give a loan within minutes. Sometimes loans are given even when such documents are not available. Most of the time such apps have no relation with any bank or NBFCs.

How does this week's recovery company trap customers?
Actually, these companies appeal to the customers for their good track record. And sometimes promise to give loan up to Rs 50,000 on app within a min without any income proof. As soon the customer downloads their mobile app, these people get access to all the personal information, contact details, and photo galleries of that customer.

Why do people get into their trap?
A person struggling with the shortage of money either does not read all the articles or ignores it even after understanding it. And this is where the game of extortion begins.

Charges of instant loan apps
Instant loan companies charge an annual interest of 36%-50% and also charge heavy penalties daily for not repaying the loan on time. Sometimes it goes up to 50% of the loan amount. These companies also charge processing fees of 20-25% and also levy 18% GST. For example, if someone took a loan of Rs12,000 then he/she will get Rs 10,000 in hand.

What happens in case of delay in repayment of the loan?
If there is a delay in payment, then it is not known when the amount doubled by adding penalty and interest. Delay in loan repayment leads to an endless cycle of bullying and exploration. This includes defaming on social media and sending obscene messages to people on the contact list.

The Reserve Bank has cautioned the people against such cases of increasing Exploitation. Customers should never give a copy of a KYC document to a stranger agent or app that is not associated with NBFC or any bank for giving loans.

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RBI की सख्ती के बाद भी चालू है इंस्टेंट लोन का डर्टी गेम, ओछी हरकत पर उतरे रिकवरी एजेंट्स।#AapkiKhabarAapkaFayda की ये खास रिपोर्ट#InstantLoan | #RBI | #MoneyLendingApp | @AnchorDeepak_ pic.twitter.com/hztkFX3I2C

— Zee Business (@ZeeBusiness) March 17, 2022