Loan (Lending) Apps - A Need or Fraud

August 26, 2022

It is second article of the day, since I have been publishing two articles on Friday. One to give a summary or the previous week, and second as usual, which I do publish on daily basis.

Food, Shelter and Clothing, these three are the basic needs [of every person]. Without these, of course, survival is difficult and in some cases impossible. These things can sometimes make do some illegal or bad activity, work, or task. Most people in the greedy world take advantage of their needs and necessities.

A few days ago something like that happened with one of my cousins. A week ago he told me, he had been searching Google Play and he was an app saying it gives interest-free loans (100%) to students. He said that he downloaded the app just to check what it has and what are its requirements.

Photo by Matam Jaswanth on Unsplash

He installed the app, and there he selected the lowest amount, which was Rs.1500 (~$6.80 @ current rate 220.53). The app asked him for providing some details, in order to verify. He said he provided 100% INCORRECT information, and when it asked to provide a picture of front side of ID Card, he just took a picture of wall, for the back when asked again he took a picture of another wall.

Photo by bruce mars on Unsplash

He said that he was sure he won't get any loan, and will laugh at him for providing some random and wrong information, and especially for the ID Card picture, which was required for verification.

He said that next day, early in the morning when he got up, he saw a notification on his phone saying he received Rs.1200/ (~$5.44 @ the above rate). When he was his EasyPaisa. He suddenly opened the app, there he also saw request for the loan of Rs.1500/- approved and loan granted". He lodged a complaint, where he attached a screenshot that says it is interest-free and he has provided wrong information, moreover he was not contacted for confirmation and verification, how could they process and give him loan.

He got a reply like:

Rs.300 is processing fee.

Nothing more in reply.

Moreover, he also got notification in app and also a message on mobile that he will have to return the loan (Rs.1500) within 15 days, failing which he will have to pay Rs.1800 (for every 1500 days he will have to pay extra 300 extra). Meaning the more it takes time to return the more he will have to pay.

• He asked that he couldn't find anywhere in the rules or else where, it is mentioned the loan has a processing fee.

• And what about the wrong information and ID pictures I have provided?

• Why he was not contacted before processing?

He got a reply like

• Everything has a processing fee and you should have asked somewhere.

• As per record available to him, everything seems fine.

He said that he will return 1200 he got, he said sorry sir it is not 1200 but 1500 they lend him....

It was a very lenghty conversation, in some places they have just trying to ignore his query, in other places he gets wrong or irrelevant reply, somewhere he replied with "Sorry, I don't have access to this inform" or "Sorry, it is company policy"

Nowadays, I think in the app it is Rs. 2400, that he sees that he will have to return.... My cousin made a complaint against the app - he also mentioned a few other app he suspected, to the State Bank and PTA (Pakistan Telecommunications Authority).

It don't say every app in this category is fraud or doing so, what I meant by this to give you some awareness and tell you something like this can be happened with you. Always do your own research and find about the company or individual behind this. Always try to read the reviews of the app.

@LeonaReed

Closing Arguments

Never go for something you don't know about it or try to avail an opportunity that has not clear rules/policy or if it is not authorized (by any authority) or legal. Try to avoid such apps and such fraudulent. Try to read reviews of the app, more probably the negative ones or low rated. DYOR

Lead Photo by Frederick Warren on Unsplash