Fraudsters may no longer be able to use Facebook, Instagram to trick users with fake loan apps ads: Report

The Centre might soon start forcing companies like Facebook and Instagram to do their due diligence before letting bad actors advertise fake loan apps on their platforms. As per a report by India Express, the government is working on stopping the distribution of fraudulent loan apps via these platforms in India. “We will amend the existing Information Technology Rules to prohibit intermediaries from hosting advertisements of fake loan apps,” stated Minister of State for Electronics and IT Rajeev Chandrasekhar. Once these regulations are in place, by hosting such ads on the platform, they will risk losing their legal immunity.

Notably, these platforms allow fake loan apps to advertise their apps on the platform for a particular fee, only to take it down when users report it online. As per the report, it is expected that the changes that the government is planning to make might not come into force before General Elections scheduled for later this year.

The minister further added, “The IT Ministry has been discussing the issue for several months with the Reserve Bank of India, but we have recently intensified our effort to find a solution to this problem.”

These fake loan apps usually lure users on the platform with attractive offers. However, these apps design their services to trap borrowers by offering them high interest rates and deceitful descriptions. These apps offer loans on high amounts at minimal rates. However, once the loan is approved, users are often hit with hidden charges and huge interest rates. These apps can also access the sensitive information like contacts, messages and financial data of the borrowers that can be misused for various purposes like Identity theft, and spam.

Recently, RBI Governor Shaktikanta Das announced that the central bank has shared a whitelist of lending apps with the Indian government. This is a significant step in the ongoing fight against illegal loan apps that have been plaguing the country. Asp per a statement of senior IT Ministry official, shared with Indian Express, "The RBI has been working on a list of valid lending apps for a while, but has sent us a new list of loan apps that are being used by registered entities like banks and NBFCs after your report came out. We will take action accordingly.” 

Also Read: 

OnePlus 12, OnePlus 12R, Nord Buds 3 launched in India: Check price, sale offers, specs

Republic Day sale 2024: iPhone 15 available at Rs 11,000 discount on Vijay Sales