Google India recently evaluated and banned several personal loan apps from the Play Store that breached its user safety regulations. Several apps that do not appear to be governed by any regulations have recently appeared on the internet. Customers must provide basic information in order for these applications to issue loans in a timely manner.
Defaulters are required to pay a predetermined late charge per day in addition to interest with these lending apps, according to Suman Gandham, Founder of Finin. These businesses are infamous for leaking data and engaging in aggressive confrontations in order to reclaim money lent, resulting in data breaches and abuse.
"To gain money, such businesses manipulate consumers into a vicious circle of debt, interest payments, and late fees. This is one of the most essential reasons to be exceedingly cautious about where and from whom one takes a loan "Gandham expresses his opinion.
Legitimate lenders, on the other hand, complete a conventional KYC that includes PAN, Aadhar, and mobile number verification, and the data is securely stored with no danger of any other personal information being extracted.
"The customer must sign a loan agreement form with a registered NBFC/bank and undergo a credit bureau check, according to the RBI. All of these crucial procedures are overlooked by fraudsters. This results in aggressive collection calls, and payday lending organisations wind up imposing extremely high penalties for customers who are unable to repay the loan amount. Even a single day's late payment results in the lender dispatching enforcers to extort the money "MoneyTap Co-Founder Anuj Kacker reveals.
The Reserve Bank of India has realised this and is working hard to eradicate any vestige of such lending practises in India.
Before you take out a quick/easy loan through a loan app, keep the following points in mind:
Verify credentials
Users should evaluate the credentials of lending apps and check whether they have RBI registered NBFCs or real partners for disbursing the loans, according to Satyam Kumar, CEO& Co-Founder, LoanTap.
"It's critical to distinguish between legitimate lenders and unlawful apps in order to meet demands without falling victim to any fraudulent activity," Kumar advises.
Know the lender
While platforms, regulators, and law enforcement fight to eliminate unlawful lending apps, Anil Pinapala, Founder & CEO of Vivifi India, encourages potential borrowers to protect themselves by using best practises to 'know the lender.'
"This means that before downloading the app, clients should check the lender's website to make sure they are a properly incorporated Indian firm with a legitimate certificate of registration," Pinapala advises.
Customers should also check if the app is requesting sensitive data such as a contact phone book, which has been the source of many coercive data collection attempts, and refuse downloading any such apps.
"Once a customer has decided on a lender, they should make sure they understand the exact cost of the loan before signing the contract to see if there are any hidden charges or fees." As a result, clients should place a higher priority on legality, transparency, and full disclosure rather than the allure of speedy clearance," he says.
Furthermore, Pichain Labs Founder Shubhradeep Nandi advises borrowers to do some preliminary research on the company or its promoters.
Conclusion
There's no need to be discouraged if your personal loan application is turned down. To boost your chances of loan approval, simply work on improving your credit report and following the methods outlined above. Once you've completed this checklist, you're ready to submit your personal loan application.To find about the best pricing and deals, call our toll-free number +91-9477079053. They'll help you in every way they can. Please contact me at Instant Loan if you have any more.