Getting a personal loan is no longer a difficult task. You have multiple banks and financial institutions like CASHe offering you instant personal loans. But on account of easy availability, personal loan frauds have also witnessed a major increase in the last couple of years. There is no doubt that personal loans are of great help but it should be noted that they can be dangerous if not dealt with in the right manner. So, it is important to know how to spot and avoid scamsters who try to trick people looking for loans.
With this guide, let’s understand what is online fraud, common scam methods, how to recognise scams and fraud sites, steps to avoid them, and what to do if you encounter loan scams.
Common Personal Loan Scam Methods
Scammers resort to a number of ways to trick people into fraudulent loans. Here are some of the major methods using which they try to steal your money or information:
Asking Upfront Fees: This is one of the most popular and common frauds in lending. Scammers ask you to pay a fee before you get the loan, but after you pay, they disappear.
Phishing Scams: Here, scammers would send emails or messages pretending to be real lenders and asking for your personal or financial information.
Fake Lender Websites: You come across fraud sites that look like real lenders but their main agenda is to collect your data and payments.
Guaranteed Approval Scams: In this method, scammers would promise to provide you with a loan without checking your credit history.
Also Read: 6 Common Personal Loan Scams and How to Avoid Them
How to Identify Personal Loan Scams
This is one of the major issues which should be addressed. So, here are the warning signs you must look for so that you can spot a scam easily:
Unsolicited Offers: Be careful if you get loan offers out of nowhere, especially from unknown sources.
Pressure to Act Quickly: If someone pushes you to make quick decisions or payments without giving you time to think, then become cautious.
No Physical Address: Keep in mind that real lenders have a physical office address and if someone contacting you doesn’t provide you with the address, then it is definitely a scammer.
No Credit Check: Scammers would also promise you to provide a loan without checking your credit history.
Advance Payment Requests: If a lender asks for money upfront, it is often nothing but a scam.
Bad Communication: Poor grammar in texts and unprofessional communication are often signs of a scam.
Steps to Avoid Personal Loan Scams
You can avoid personal loan fraud with the following steps:
Step 1: Research the lender and check the lender’s reputation online through reviews.
Step 2: Make sure to verify licencing and check if the lender is registered with the Reserve Bank of India (RBI).
Step 3: Check contact information and verify the lender’s physical address and phone number.
Step 4:Avoid upfront fees and do not agree if asked to pay a fee before receiving the loan.
Step 5: Protect your personal information and do not share anything unless you are confident about the real lender.
Also Read: 10 Tips to Protect Yourself From Loan Fraud
What to Do if You Suspect a Scam
You should be prompt and alert while dealing with scammers. Here’s what you should do if you encounter loan scams or fraud sites:
- Break all the contacts with the scammer.
- Next, inform local police authorities.
- Now, notify your bank and ask them to protect your accounts if you have shared any information with the scammer.
- You can also check your credit report if you suspect any unauthorised activity.
Conclusion
This is what is online fraud and how you can help yourself in cases of any fraud in lending. Make sure to stay informed and be careful while availing loans. Also, take immediate action if you suspect a loan app fraud to protect your money and personal information.
Now, if you are looking for an instant personal loan without experiencing any scams or fraud, then download the CASHe app right away. CASHe provides personal loans of up to ₹4 lakhs with an easy loan repayment schedule, competitive interest rates and transparent loan terms.
