If quick money is what you looking for, then getting an instant loan online is really handy. But you should also note that it can also be risky as there are scammers out there trying to trick people with loan scams or personal loan frauds. They may use fake loan apps and send fake emails to steal your personal and financial information. However, if you know these risks, then you can certainly stay safe. So, let’s understand more about these loan risks and frauds.
Common types of fraud that we should be aware of
Here are the most common frauds you may encounter and hence, you should be aware of:
- Phishing: Scammers send fake emails or messages that look like they are from real lenders to steal your personal information.
- Identity Theft: Scammers use your personal information to take out loans in your name.
- Advance-Fee Scams: In this loan scam, scammers ask you to pay fees upfront for a loan that does not exist at all.
- Fake Loan Apps and Websites: Now, with this, scammers create fake apps and websites that look real to steal your information or money.
10 Tips to Protect Yourself from Loan Fraud
1. Use Reputed Loan Apps
Only apply for instant loans through reputed loan apps. There are many mobile apps on the market that offer a range of personal loans and instant loan options. Do your research and only go ahead with apps, lenders, and companies that are well-known and verified. Download the loan app from the company’s official site.
2. Double Check the Loan Agreement Before Signing It
When you apply for a loan, you receive a loan agreement from the lender that has all the terms and conditions of your loan. Make sure to read the fine print carefully and double-check all the loan details before signing the agreement. This is to verify that all the information of the lender and the terms of the loan are legitimate.
3. Verify Lender Before Submitting Confidential Information and Transferring Funds
You might need to pay certain processing fees when you apply for a loan. Verify the lender before you submit your confidential information and transfer funds to them. You can check if the lender is legal through the Reserve Bank of India website.
4. Use a Secure and Private Internet Connection
Applying for a loan through public WiFi might put your data at risk as scammers might be able to access sensitive data such as your card details and bank information. So, when you are submitting confidential information online, it is worth taking extra precautions and using a secure and private internet connection.
5. Check That the Website Is Legitimate
An easy way to check if the website that you are applying for the instant loan is legitimate is if the website URL starts with a ‘https://’, rather than ‘http://’ or any other variation. Keep an eye out for fake or imposter websites whose names are similar to popular loan apps and websites.
6. Do Not Pick Up Unsolicited Calls
Do not pick up unsolicited calls or respond to phishing texts and emails. Identity verification or true caller apps that show the details of the caller can help you avoid scammers. Legit banks, loan apps, or other lenders never ask you to share sensitive information on call or text. So, if anyone asks you to do so, they are likely a scammer and you can report their number to the authorities.
7. Keep Your Phone and Computer Security Updated
Most operating systems offer built-in security from hackers and viruses. They roll out regular updates to improve their security. Regularly updating your phone and computer security certainly goes a long way in protecting you from fraud. You can also install special antivirus software on your mobile or computer.
8. Read the Site’s Privacy Policies
Most loan lenders have privacy policies that are available to read on their website or app. These policies show how they protect your financial and personal information. If you aren’t satisfied with the privacy policy, search for another provider to get a loan.
9. Create Strong Passwords
Creating a strong password can keep your financial information safe. Follow the guidelines set out by the lender regarding the capital case, lowercase, and special characters to create a password that is difficult to crack.
10. Don’t Offer Remote Access to Your Computer
If a caller asks for remote access to your phone or computer, they are likely a scammer. Through remote access, someone can get into any confidential financial information you may have saved on your phone. So, be safe and never give permission for it.
Getting sensitive information leaked can lead to many problems. But, you can stay safe from an online loan scam or personal loan fraud with the proper precautions!
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FAQs
1. What are the common types of fraud associated with instant loans?
Common types of fraud include phishing, identity theft, advance-fee scams, and fake loan apps or websites to steal your personal or financial information.
2. How can I identify a legitimate lender versus a fraudulent one?
A legitimate lender would have a physical address, customer service contact, and a secure website (https://). They would also be registered with appropriate regulatory bodies.
3. What red flags should I watch out for when applying for an instant loan online?
You should watch out for unsolicited loan offers, requests for upfront fees, lack of a secure website, poor customer reviews, and pressure to act quickly. Always verify the lender and read the fine print before proceeding.
4. What should I do if I receive unsolicited loan offers or calls?
You should not respond to unsolicited loan offers or calls and report any suspicious numbers to the authorities.
5. How can I report a fraudulent lender or scam?
You can report a fraudulent lender or scam to your local law enforcement authorities, consumer protection agencies, or the Reserve Bank of India.
