Instant loan apps have changed the money lending procedure by offering easy and quick access to a loan amount in just a few clicks on your smart device. However, along with gaining extreme popularity, loan applications are also associated with numerous scams that are difficult to identify. An instant loan app undoubtedly simplifies the process of obtaining a personal loan, but it also comes with multiple risks of fraud. Therefore, you must avoid applying for a loan on any app that requests unnecessary personal data or advance payments. Moreover, make sure that the app is registered with the RBI before applying for a loan.
This article helps you differentiate between a real loan application and a fake one.
Differentiating Between A Real And A Fake Loan App:
To identify between a real and fake loan app, consider the points given below:
- Data security
Each cash loan app that you download requests specific data from your smartphone. However, most genuine loan applications definitely mention the reason for requesting any necessary information. Be aware of apps that request unnecessary details, which could compromise your data privacy.
- Authorised and registered by RBI
The Reserve Bank of India regulates all lending activities in the country. Hence, each loan application must be registered with the RBI. This is a crucial step to ensure the platforms adhere to specific rules and regulations set forth by the central bank, thereby offering protection to borrowers from scams. Having the RBI’s registration would indicate that the particular money loan app adheres to all guidelines issued for the borrower’s interest.
- Contact details
Always verify the contact details of the personal loan app you are planning to choose. Moreover, verify the address and website of the app provider as well. A trustworthy loan app will offer complete transparency by providing legitimate contact details and an address. However, on the other hand, fraudulent loan applications will often fail to provide genuine physical presence and contact information.
- Online reviews and feedback
Before downloading any personal loan online app, ensure you check the ratings and reviews from consumers on the App Store. Apps that receive positive feedback and better ratings inherently represent their legitimacy; however, low ratings and negative reviews suggest that the app may not be genuine. Through this, you get to differentiate between fake and authentic loan apps. However, avoid relying entirely on ratings and reviews, as they are not the best metrics to gauge the authenticity of a loan app, as many reviews can be fake.
- Absence of KYC
The KYC, or Know Your Customer, process is used to verify a borrower’s identity and ensure compliance with anti-money laundering regulations. This is a compulsory process forwarded by the Reserve Bank of India. If your emi loan app fails to implement KYC, it may be a scam.
Conclusion:
Although it has become easier and more convenient to take out loans online, they also carry an equal risk of borrowers being scammed through various forms of fraud. Hence, ensure that you are careful and diligent before applying for any loan. Also, avoid getting attracted to unrealistic apps or loan offers and seek professional advice to make an informed lending decision.