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Fake Loan Apps: What are they and how to identify them?
Reviewed by: Anil Sinha
- Updated on: 8 Jul 2024
- Published on: 8 Jan 2024
Reviewed by: Anil Sinha
It has become quite difficult to identify whether a mobile loan app is real or fake as umpteen fraudulent applications offer loans to customers with wrong intentions.
Such cases have increased due to a rise in digital lending. However, you can avoid falling into a trap set by these applications by taking certain precautions. Read more about these fake applications providing small personal loans and how to identify them and prevent such scams.
There are two types of fraudulent lending applications. Those belonging to the first set of scammers extort loan fees by promising quick access to money. The second set is even worse. They levy high interest rates on loans and exceed the ceiling set by the RBI.
Quick access to credit may seem only a few clicks away in this digital age. However, the lender promising instant money can also be a scammer.
Here are some ways by which you can identify fake loan apps in India:
Remember, loan apps need to follow the RBI guidelines in India. If an app doesn’t follow them, it certainly is a red flag that the app may be a fake.
This may also be an identifier of a fake lending app. Know that certain fraudulent lenders also create fake websites to scam borrowers.
Fake loan apps generally don’t provide loan agreements to hide necessary information. To assess borrowing costs, knowing about interest rates and charges is crucial.
A genuine lender never requires you to pay the processing fee for a loan in advance. Instead, you’ll have to pay these charges only after your loan application has been approved. Avoid any transaction with a lender requesting you to pay the processing fee or other charges in advance.
As per the RBI mandate, lenders must collect your personal information when providing a loan. It may be a red signal if a lender doesn’t require you to submit any documentation.
You may find a majority of negative reviews for fraudulent lending applications online. Hence, check for the reviews of a lender before applying for an instant loan.
Fraudulent lending applications can steal your hard-earned savings and leave you in financial turmoil. You must take these steps to prevent falling into a trap set by fake loan companies in India:
Before applying for a loan, check if the lender’s name features in the list of lenders approved by the RBI. Once you check this, you can rest assured that you aren’t falling into any trap. Check this list on the official website of the central bank.
To validate a lender’s authenticity, you can check if their website is secured or not. A secured website generally has ‘https’ added at the beginning of the URL.
If the lender doesn’t provide you with an agreement, demand one before availing of a loan. So, read all the terms and conditions carefully before you plan to take a loan.
Before applying for a loan, check the charges associated with a loan facility. Note that some loans also carry hidden charges.
As per the RBI guidelines, a lender cannot store a borrower’s information beyond their personal details. Check if the application asks for access to data that it may misuse in the future.
Looking for instant credit while avoiding being a victim of a shady application? Fibe can be your best bet, the authenticity of which you can check in the following ways.
Protect your hard-earned money by staying away from fraudulent lenders. Here is a fake loan app list in India removed by Google from its platforms in December 2023:
Falling for the trap set by fake loan apps can dwindle your finances and push you into a debt cycle. You can get genuine Personal Loans of up to ₹5 lakhs from Fibe, which is an RBI-registered lender. Download the Fibe Personal Loan App to get a loan with quick sanction and minimal paperwork.
Reserve Bank of India has approved many loan applications. Fibe is one such lender that provides quick personal loans on the principles of ethical lending.
You can find fake loan apps by following certain strategies. Most importantly, check if the application is registered with the RBI.
Yes, Fibe is a genuine loan application registered with the Reserve Bank of India. We follow the ethical lending guidelines laid down by the central bank.
You can check if the lender is a regulated entity on the RBI’s website to determine if a loan offer is real.
Reserve Bank of India has prohibited the use of the following lending applications and more.
You can employ the following strategies if you are thinking, ‘Is a loan app fake or real?’-
While you cannot block them, you can report fraudulent activities of such apps to the app store and competent authorities.
Lenders regulated by the RBI are considered safe for borrowing. For instance, Fibe is a regulated application under the central bank.
