Policy Watch
Chinese Loan apps: MHA Instruct States, UTs To Take Urgent Action Against Instant Lending Apps
![Chinese Loan apps: MHA Instruct States, UTs To Take Urgent Action Against Instant Lending Apps](https://www.the420.in/wp-content/uploads/2022/10/Chinese-loan-app-MHA-takes-strict-action.jpeg)
NEW DELHI: The Ministry of Home Affairs (MHA) urged states and union territories (UT) to pay “immediate attention” to unlawful digital lending apps that “lead to countless suicides by individuals as a result of harassment, extortion, and severe recovery procedures.”
According to the ministry, this issue has grave implications for national security, the economy, and public safety.
“These unlawful loan apps, which may or may not be authorised by RBI, are leveraging enormous quantities of bulk SMS, digital ads, chat messengers, and mobile app stores.”
The Home Ministry is blocking such applications, and it is anticipated that some of them will be blocked soon.
Recently, The420.in released a series on illegal loan apps highlighting how they exploit a web of unlawful shell firms and target individuals to extort illegal funds. Several of them have even committed suicide.
MHA, in its letter, stated a large number of complaints have been reported across India regarding illegal digital lending apps that provide short-term loans / microcredits at exorbitant interest rates with processing / hidden fees, especially to vulnerable and low-income group individuals, and use borrower’s confidential personal data such as contacts, location, photos/videos for blackmail/harassment.
“Many lives have been lost in India as a result of the harsh recovery methods employed by illegal lending apps,” This issue has had significant effects on national security, the economy, and the safety of citizens, MHA said in the letter.
ALSO READ: In First-Of-Its-Kind Move, MHA Plans To Block Mobile Numbers Involved In Cyber Crimes
“It has come to light that these unlawful lending apps, which may not be Regulated Entities (RE) by RBI, are leveraging enormous quantities of bulk SMS, digital advertising, chat messengers, and mobile app stores. To obtain a loan, the borrower must grant access to contacts, location, and phone storage. This data is utilised by recovery agents in India and abroad to harass and blackmail citizens through modified photos and other abusive techniques, in violation of RBI’s Fair Practices Code “MHA added.
According to the MHA, it is an organised cybercrime perpetrated via disposable emails, virtual numbers, mule accounts, shell organisations, payment aggregators, API services (account validation, document verification), cloud hosting, crypto currency, etc. Consequently, it is recommended to enlist domain specialists in the research.
ALSO READ: Victim Of A Cyber Attack? Now Dial 155260 To Register Complaint And Get Your Money Back
“Law Enforcement Agencies may utilise the services of the National Cyber Crime Forensic Laboratory (NCFL), one of the divisions of the Indian Cyber Crime Coordination Center (I4C), CIS Division, for technical assistance with loan application analysis, malware analysis, and crypto transaction tracing. For the same, authorities can send an email to dc.ncfl-i4c@mha.qov.in “the MHA reported.
“All states and territories have been asked to take stringent legal action in this regard.” Moreover, all states and territories are urged to raise public awareness in all districts about the dangers of using such programmes.”
Follow The420.in on
Telegram | Facebook | Twitter | LinkedIn | Instagram | YouTube