Before You Apply for a Loan Online, Make Sure Your Identity Is Safe

Imagine finding a loan app that promises quick approval. The application looks simple, the reviews seem positive, and the representative assures you that the money will arrive soon.

You upload your PAN card, Aadhaar details and a selfie. Then comes a request for an upfront payment. After you pay, the representative stops responding.

Unfortunately, the loss may not end with that payment. If the app collected your personal information, you may also need to worry about identity misuse.

Understand the Most Common Tactics

The advance-fee scam

A fraudster claims that your loan is approved but asks you to pay a processing charge, insurance fee or security deposit first. Never rely on a message or call alone to establish whether the charge is legitimate. Confirm all applicable fees and payment arrangements through the regulated lender's official channels.

Fake KYC requests

Scammers may collect Aadhaar details, PAN information, selfies and bank details under the pretext of completing verification. They may later attempt to misuse this information or sell it to others.

Photo manipulation and blackmail

Some fraudsters misuse private photographs or digitally altered images to threaten victims. If this happens, save the evidence, avoid sending more money and report the incident to the appropriate authorities.

Fake loan settlement offers

Borrowers who are already struggling with repayments may be approached by people promising to reduce EMIs or settle outstanding debt for a fee. Contact your lender directly to verify any such offer.

How to Check Whether a Lender Is Genuine

Start by identifying the actual bank or NBFC providing the loan. Check the lender's credentials using official regulatory information and confirm that the digital lending app is associated with the lender as disclosed through its official channels.

Download apps from official app stores, but remember that an app's presence in a store does not by itself guarantee legitimacy.

Read the loan agreement, understand the interest rate and charges, and never share OTPs or banking passwords with an agent.

Also, review the permissions requested by the app. A request for unnecessary access to contacts, messages or photographs deserves careful scrutiny.

What If You Have Already Shared Your Details?

Act quickly. Contact your bank if financial information or payment credentials may be compromised. Change affected passwords, revoke unnecessary app permissions and review your credit report for unfamiliar accounts or enquiries.

If money has been lost through cyber fraud, call 1930 promptly and file a complaint through the National Cyber Crime Reporting Portal. Preserve screenshots, transaction references and conversations.

Borrow With Care

Digital lending can make the application process more convenient, but convenience should never replace verification.

Before choosing a loan, explore the information available through PSB Loans in 59 Minutes. For more practical advice, read Stay Alert Against Morphing Scams: How Borrowers Can Protect Their Identity While Applying for Loans.