At an event today in India, Google announced it has removed more than 2,000 personal loan apps from its Play Store after they were found to be in violation of its policies.
Saikat Mitra was at the event in New Delhi on Thursday. The Senior Director and Head of Trust and Safety at Google Asia-Pacific said the aforementioned apps were targeting Indian users and that the decision to take down the apps arose after his company consulted with local law enforcement agencies.
Mitra said that the company was working with several stakeholders like government agencies, media and user referrals, apart from deploying its artificial intelligence/machine learning capabilities, to penalise bad actors on the Play Store.
The tech giant has said it is attempting to amend its policy.
The announcement comes at a time when the local central bank is cracking down on predatory lending practices.
The Federal Government of Nigeria through the Federal Competition and Consumer Protection Commission (FCCPC) also made a similar request to Google to remove four loan apps being used for unethical practices from the Play Store. The apps reported were Maxi Credit, Here4U, ChaCha, and SoftPay.
A report by Premium Times confirmed Mr. Babatunde Irukera, the commission’s Chief Executive Officer, gave the order during an enforcement operation in Ikeja area of Lagos last week.
The rise in digital lending by unregistered and fraudulent apps has been a major concern that has had the government, the Reserve Bank of India (RBI) as well as the Directorate of Enforcement (ED) in a bind. The issue began back in 2020 when instances of high-handed loan recovery methods by these apps that lend to unsuspecting customers at high rates pushed many to suicide.
Instances of harassment, and pushing customers to die by suicide still continue to grab headlines. Google India had previously said that it has reviewed hundreds of personal loan apps and those who were found violating the user safety policies were immediately removed from its play store.
A recent newspaper report about suicide by a Bangalore-based man, Nanda Kumar, stated that he had availed loans from at least 40 instant loan mobile apps and his inability to repay led to recovery agents coming after him. After being harassed by them, Kumar decided to take the drastic step and ended his life.
Kumar is not alone when it comes to loan repayment going wrong. The harassment in many other reported cases is similar and relies on morphing publicly available information of the borrower, particularly personal pictures, in a compromising way. This leads to extreme embarrassment which is difficult to explain away, given that the explanation itself would reveal the extent of debt that person was reeling under.
According to data from National Crime Records Bureau, the number of suicides has seen a big jump since the pandemic hit and roughly 25,200 of those are attributed to job losses and being in debt.
The story is similar each time. Loan apps enable small-sized loans, which many individual borrowers take several times across different app-based lenders. However, if the borrower has just lost his job or the salary is just enough to sustain timely repayments, then the equated monthly instalments (EMI) just keep adding up. All this leads to loan recovery sharks coming after not just you, but your friends and family too.
A recent newspaper report about suicide by a Bangalore-based man, Nanda Kumar, stated that he had availed loans from at least 40 instant loan mobile apps and his inability to repay led to recovery agents coming after him. After being harassed by them, Kumar decided to take the drastic step and ended his life.
Kumar is not alone when it comes to loan repayment going wrong. The harassment in many other reported cases is similar and relies on morphing publicly available information of the borrower, particularly personal pictures, in a compromising way. This leads to extreme embarrassment which is difficult to explain away, given that the explanation itself would reveal the extent of debt that person was reeling under.
According to data from National Crime Records Bureau, the number of suicides has seen a big jump since the pandemic hit and roughly 25,200 of those are attributed to job losses and being in debt.
The story is similar each time. Loan apps enable small-sized loans, which many individual borrowers take several times across different app-based lenders. However, if the borrower has just lost his job or the salary is just enough to sustain timely repayments, then the equated monthly instalments (EMI) just keep adding up.
All this leads to loan recovery sharks coming after not just you, but your friends and family too.
While the more organised fintech lending platforms are perhaps more cautious before approving loan applications, there are others who may not go the whole hog.
Being cautious while adding numerous loans and managing your money judiciously are important and in your control. You’re best placed to know if your loan is laying out a death trap.
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