How to protect yourself against loan app scams

The ease of borrowing on loan apps has led to a surge in scams across the city.

Earlier this week, a 36-year-old woman fell victim to blackmail by agents of a loan app. She installed an online loan app not available on either the Play
Store or App Store. The app credited Rs 2,400 to her account three times, and then the recovery agents began to harass her, sharing her pictures, and also pictures of her child, with her contacts.

In a similar incident last week, a 34-year-old woman who downloaded an instant loan app named ‘Cash Box’ by clicking on a link on social media was harassed.

Advertisements about such apps are rampant on social media. “I recently opened a new bank account and since then I have been getting ads on Facebook for shady loan apps,” says Aishwarya N M, a 24-year-old corporate employee.

Metrolife asked cyber security experts for advice on how to deal with such scams.

Check source

Pranav M Bidare, researcher at Centre for Internet Society, advises individuals to be wary of apps that aren’t available on Play Store or App Store.

“If you end up downloading something from a link, and it installs an icon on your home screen, it may look like an app but it most likely will end up being a shortcut to a chatbot or website. It’s not an actual application. It’s best to stay away from such services,” he elaborates.

Fraudulent operators often target individuals facing financial challenges by promising quick funds and no background checks. They either send messages claiming that a loan has been approved or target them with advertisements, promoting a “hassle-free loan” — both methods often involve a link. The loan is often between Rs 5,000 and
Rs 15,000.

Personal info risk

Karan Saini, an independent security researcher, sheds light on how scammers gain access to personal information. “When you click on such a link or download an application, you end up giving access to basic details like your name, email address and location. In some cases you end up giving access to your contacts, gallery, and even other files on your phone. Some apps ask for permission to download a separate app on your phone. This is how they end up getting access to your bank details and are able to deposit money into your account,” he explains.

‘Distrust is useful’

While red tape may put you off, banks put stringent processes in place to ensure due diligence, says Bidare.

“One has to especially be wary when something sounds too good to be true. If someone agrees to give you a loan in a matter of minutes, without knowing your financial history, it’s not a good sign,” he says.

He advises people to pay close attention to the messages they receive on their phones. “Even when you receive a message from your banking operator, be careful and pay close attention to the message. Look into the details, check if everything has been spelled correctly. In matters like these, distrust is useful,” he adds.

“Ensuring that the app is available on the App Store or Play Store is just step one. Before downloading the app, check the ratings and read reviews and testimonials. People don’t shy away from speaking up about their bad experiences. This should help in assessing the authenticity of the app,” advises Karan.

In case you end up downloading an that is suspect, “it is best to delete it as soon as possible”, he says.

“Also, check if you have given permission to download a secondary app. These usually end up acting as spyware,” he adds.

If you are scammed…

If a loan app cheats or blackmails you, file a police complaint with the cyber crime division at the local police station.

Under Section 66 of The Information Technology Act of 2000, scammers can be jailed for up to three years and fined up to Rs 1lakh, says Akanksha Natesan, advocate.
She recently received two online scam cases.

Victims can also file complaints on the National Cyber Crime Reporting Portal (i4c.mha.gov.in/ncrp).

Stay safe

* Double check source of apps

* Search for app reviews, testimonials

* Don’t click on suspect links

* Don’t grant permissions indiscriminately

* Too good to be true? Be wary