India should combat loan sharks online with effective regulation
Congratulations! Your loan application for an amount of INR x,xx,xxx/- has been approved. Simply click on the provided link to receive the funds directly into your account, hassle-free, and with no need for tedious paperwork or any additional processing fees." This message flashed on Rahul’s phone, filling his heart with hope. Desperate to provide for his ailing mother, he saw this as a lifeline.
Little did he know that behind those enticing words lay a web of deceit. As he clicked the link he was sent, he unknowingly stepped into a trap carefully set by loan sharks. The once promising message soon became a haunting reminder of how happiness could swiftly turn to misery for the vulnerable and those in need.
The menace: ‘Loan sharking’ has become a rampant problem in India, with vulnerable individuals falling prey to exploitative lending practices. The tragic case of a recent suicide in Madhya Pradesh served as a stark reminder of the urgent need to address this issue. Therefore, it becomes essential to shed light on the menace of loan sharking in India, the implications of recent cases, and a plausible way forward.
The anatomy of loan sharking: Characterized by exorbitant interest rates and coercive tactics, it targets individuals in dire need of financial assistance. Predatory lenders often prey on low-income individuals and those with limited access to traditional banking services. These loan sharks operate through physical establishments, online platforms and mobile applications, masquerading as legitimate financial entities.
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