Beware of loan sharks! 3 bite-sized hacks to avoid pesky loan scams

livemint.com:

loan scams. However, it is important to adopt a vigilant approach and follow a comprehensive checklist to safeguard your financial security when using instant loan apps. The advent of the internet has undeniably simplified transactions, eliminating the need for extensive paperwork in the loan application process.

Nevertheless, this newfound convenience comes at the expense of heightened security risks. The Reserve Bank of India (RBI) reported around 13 thousand bank fraud cases across India in fiscal year 2023. Loan frauds have become increasingly prevalent, with scammers often impersonating reputable lenders.

These fraudulent operators promise a hassle-free experience and quick funds without conducting background checks or scrutinising credit history. A common scam targets individuals facing financial challenges, particularly those struggling to secure loans due to unfavourable credit histories. In this scheme, scammers send messages and links to vulnerable individuals, claiming that a loan has been approved for them.

Upon clicking the link, users are prompted to grant access to their contacts, gallery, location, and more. This ploy allows fraudsters to take information from the devices of unsuspecting loan seekers. Thorough research: Before engaging in any kind of loan scheme, conduct in-depth research on any potential lender.

Rely on reviews, testimonials, and ratings from reputable sources to verify the legitimacy of the lender before proceeding. Identifying scams: Be cautious of unsolicited loan offers via email, text, or phone. Only engage with well-known financial institutions and avoid sharing sensitive information until the legitimacy of the lender is confirmed.