Complaints have increased against fake apps giving digital loans, if you want to avoid their clutches then understand everything

The number of complaints against illegal digital lending apps more than doubled to 1,062 in FY23, the Finance Ministry told the Lok Sabha in the monsoon session of Parliament.
Let us tell you that the Central Government and the Reserve Bank of India (RBI) have been cracking down on illegal digital loan-giving apps for the last few years, but despite this, the number of complaints has more than doubled. According to the available data till November 2021, the number of complaints was 263.
According to the latest available data from the National Crime Records Bureau (NCRB), the total number of cyber fraud cases, which also include frauds committed through online apps, stood at 14,007 in 2021.
Moreover, a large number of such financial frauds are never registered with the police or the RBI.
Complaints against Regulated Entities (REs) regarding online loan apps/digital loans are being lodged with RBI as per the RBI-Integrated Ombudsman Scheme, 2021.
Apart from this, a portal named 'Sachet' has also been set up under the State Level Coordination Committee for the system of registering complaints by the public regarding digital loans.
Let us tell you that many digital lending apps are working illegally and are not part of any arrangement with RE due to which they are not part of the complaints lodged with RBI against RE.
There have been several cases of customer suicides after constant harassment by some of these loan apps.
The government and regulators are cracking down on such digital lending apps through various measures and have asked Google and Apple stores to remove such loan apps from these app stores by banning them.
RBI has asked Google and Apple to prevent digital lending apps from accessing personal loan contacts along with photos of customers from May 31, 2023.
The move comes after some loan lending apps started threatening and shaming customers by calling their contacts.
As per the rules, apps are required to provide supporting evidence such as a license of the app from RBI to act as a registered loan provider.
If the app is only a distributor, it will also have to disclose the names of its lending partners such as banks and non-banking financial companies (NBFCs).