Google to ban fake loan apps in Pakistan on, July 31

Web Desk

28th Jul, 2023. 07:02 pm
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KARACHI: In a proactive move to safeguard consumers from fraudulent practices, Google has taken a significant step by banning unregistered and fake loan-providing applications operating in Pakistan. The decision was made at the request of the Securities and Exchange Commission of Pakistan (SECP) in response to the alarming proliferation of these deceitful apps.

According to reliable information from the SECP (Securities and Exchange Commission of Pakistan), Google is set to implement the ban on questionable loan applications on July 31, 2023. The decision comes in response to mounting complaints and distressing reports of suicides related to these exploitative apps, which have become a matter of concern for the authorities.

Social media platforms have become a breeding ground for organized groups that are preying on financially struggling individuals affected by inflation. These groups resort to blackmailing to extort money from vulnerable victims. Although some actions were taken against more than 43 illegal loan apps in the past, the issue has not been resolved, leading the Cyber Crime Wing of the Federal Investigation Agency (FIA) to escalate its efforts to combat this problem.

The tragic suicide of Muhammad Masood, a 42-year-old man from Rawalpindi, who fell prey to these manipulative loan apps, added urgency to the situation.

The SECP has responded by issuing advice to borrowers, urging them to carefully review the legal status of digital loan applications before signing up. Thoroughly reading and evaluating all disclosures related to fees, late payment charges, loan tenor, cooling-off period, and the privacy policy of these applications is crucial to avoiding potential exploitation, says the SECP.

To facilitate the process of reporting and addressing complaints, the SECP has established a dedicated complaint portal on its website.

It should be emphasized that the SECP has been actively working together with various regulatory authorities, such as the PTA, FIA’s Cyber Crime Wing, and the SBP, to address the problem of unlicensed digital lending apps that are operating unlawfully in the country.

According to an SECP official’s statement to The Express Tribune, their collaborative efforts resulted in the SBP releasing a circular in June 2022, which blocks illegal apps from accessing banking and payment channels. As the regulator of Non-Banking Finance Companies (NBFCs) digital apps, the SECP has played a proactive role in ensuring effective measures are taken against these unauthorized apps.

The SECP successfully influenced the tech giant’s Personal Loan App Policy for Pakistan. This policy imposes strict checks and balances to prevent the listing of illegal apps on the Play Store and sets stringent requirements to safeguard consumers’ personal data.

As part of their efforts, Google has taken down 84 unauthorized lending applications that were reported by the SECP from its Play Store.

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