State Police Chief (SPC) Anil Kant has issued instructions to maintain alert against mobile applications used for online loan fraud in light of the increasing cases of such fraud targeting youths and students.
Mr. Kant has instructed District Police Chiefs to take strong and effective action on complaints related to these.
In a press release issued from the SPC’s office, he said that such applications attracted customers by asking customers to provide the simplest of Know Your Customer (KYC) documents. After the customer installs the application, it gains access to all the information in the phone including the contact list. People desperate to get a loan often agree to all the requests for access.
Those who are availing themselves of a loan of ₹3,000 would immediately get between ₹2,200 and 2,600 after deductions under various heads. The repayment period is usually around a week. Agents of the company would start contacting the customer, demanding repayment, failing which they would call other numbers in the contact list claiming that they have been named as surety for the loan and that legal measures would be taken if the person fails to repay. Those who fail to repay often depend on other applications providing loans in a similar manner to repay the outstanding amount, leading to more complicated debt traps.
The SPC issued the alert against the applications, as it has been noticed that many victims are reluctant to file a complaint.