Mobile lenders name and shame defaulters

Lenders misuse their access to customer’s phone data to blackmail them

Lured by promises of easy and instant online loans, starting from just `2,000 up to `1 lakh, many who have availed such loans now rue the day they chose to borrow money from online lenders.

Little do these borrowers realise that these loans come with hefty interest rates and service charges that could amount to 35 per cent of the borrowed amount for periods even as short as a week. These app based money lending services come with various conditions which borrowers don’t go through when they download the app.

Almost every person Deccan Chronicle spoke with had not gone through the privacy policies of the lenders which resulted in allowing the mobile applications to gain access to their personal details like phonebook, microphone, camera, photo gallery, SMS list and other wallets.

In addition, the debtors had also had to furnish details of their Aadhaar and Pan cards and bank account details. That is when trouble begins.

One debtor who realised the trap that he fell into, said the lender had charged high amounts as processing fee and interest for a loan of `6,000. They are charging `420 as interest, `1,500 as processing fee and `270 as GST. They deduct these charges in advance and the disbursal amount is only `4,230 for a week, so they are earning

36.5 per cent on their investment.

Another complained that his loan amount was `2,000 and he received an amount ` 1,470 and had to repay

`2,140 within a week. In other words, he paid `670 additionally for a loan of

`1,470 which is almost 45 per cent for a period of a week. He said if you do not pay within seven days, you have to pay additional `730 for a week moratorium.

A woman who availed such a loan said she could not repay the amount on the due date and received phone calls from the company’s executive and messages on Whatsapp.

The executive asked her to pay the due amount within 45 minutes and threatened that he would call all her contacts.

He sent a few screenshots of her phonebook to make her realise that he could do so. She borrowed the amount from her relatives, got rid of debt and deleted the application immediately.

Most youngsters get loans from these apps to go on a date or to give a gift to their lover, thinking that in 10 days they will somehow raise money to repay it and are trapped.