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Pakistan Takes Action Against Unlawful Loan Apps

Pakistan Takes Action Against Unlawful Loan Apps

In a major move against unlawful loan apps, Pakistan’s Ministry of Information Technology and Telecommunications (MoITT) has taken swift action to disable 43 such apps. The Federal Minister for Information Technology and Telecommunications, Syed Amin Ul Haque, emphasized the importance of an awareness campaign to protect citizens from falling victim to these fraudulent acts.

Urging citizens to take action, the ministry advises reporting complaints to relevant authorities, including the PTA, FIA Cybercrime, and local police. By doing so, these illicit loan apps can be promptly addressed and dealt with accordingly. The IT minister has also instructed the FIA to proactively address such issues without waiting for complaints.

The rise of “easy loan” applications on Google Playstore and Apple iStore has become a growing concern. While these apps offer quick and convenient loans without lengthy paperwork, they pose a significant threat to countless people. A recent incident of a jobless man’s suicide in Rawalpindi sheds light on the severity of the problem.

As more Pakistanis turn to mobile-based lenders, scammers and fraudsters find ample opportunities to exploit vulnerable individuals. A poll by Karandaaz Pakistan revealed that the number of Pakistanis using personal finance apps more than doubled to 19% in 2022, indicating an increased reliance on such services.

To combat this issue, the Federal Investigation Agency (FIA) has opened 74 cases based on complaints and three FIRs against individuals and corporations involved in illicit loaning practices. The FIA arrested 17 people running unlawful internet loan schemes and blocked 30 accounts. The agency has also sealed five offices of organizations participating in these illegal activities.

Mohsin Hassan Butt, Director General of the FIA, has called for strict action against unregistered and unlawful mobile loan applications. He emphasizes that companies offering online loan services should obtain licenses from the Securities and Exchange Commission of Pakistan (SECP).

The SECP, as the regulatory authority, issues licenses to non-banking financial businesses (NBFC) to ensure legitimate operations. Moreover, the Pakistan Army (PA) collaborates with Apple and Google to remove unlawful microfinance apps in the country.

This nationwide crackdown aims to establish a safer digital landscape and protect citizens from falling prey to fraudulent loan schemes. Pakistan is committed to providing a secure online environment, ensuring financial inclusion without compromising on the safety and well-being of its people.

Why it is important to stay away from Online Easy Loan Apps to protect your Privacy and Security?

In the digital age, many people are cautious about using online easy loan apps due to several alarming reasons. These apps often gain access to users’ contact lists and picture galleries, raising concerns about privacy invasion. Additionally, users have reported experiencing extreme interest rates and coercive tactics, making them wary of such platforms.

One primary reason people steer clear of these apps is the unauthorized access they gain to personal information, such as contact lists and picture galleries. The thought of their private data being in the hands of unknown entities leaves users feeling vulnerable and uncomfortable.

Moreover, these apps employ illegal and exploitative practices, charging exorbitant interest rates that go beyond legally regulated limits. Users find themselves trapped in a cycle of debt, as the demands for money surpass the original principle amount along with the standard interest rate.

Even more distressing is the alarming trend of blackmail that arises from using such apps. Unscrupulous operators resort to sending edited pornographic images, taken from users’ phone galleries, to their entire contact list as a means of coercion. This ruthless tactic puts the users’ reputation and personal relationships at risk, causing immense emotional distress.

Adding to the torment, these operators resort to threats and intimidation, further traumatizing users. They may contact the individuals on their contact list and falsely label the user as a defaulter, causing embarrassment and potential damage to personal and professional relationships.

Tragically, this widespread scam has even led to incidents of suicide in Pakistan, further underscoring the urgency for people to distance themselves from these exploitative loan apps.

To safeguard their privacy, financial well-being, and emotional health, it is crucial for individuals to exercise caution and avoid all types of legal or illegal loan apps that engage in such unethical practices. By opting for established and reputable financial institutions, users can protect themselves from falling victim to these alarming scams.

In conclusion, the alarming consequences of using online easy loan apps, including privacy invasion, illegal interest rates, blackmail, and threats, warrant a strong stance against engaging with these platforms. The safety and well-being of users should always be a top priority, and by being informed and vigilant, individuals can shield themselves from the perils of these exploitative practices prevalent in some loan apps in Pakistan.

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