KOCHI: If online loan providers had targeted people hit by financial trouble during the Covid-related crisis earlier, same loan sharks are targeting children addicted to online games these days. Police and NGOs operating in the cyber sector have been getting complaints about threat calls received by children and parents from loan sharks asking to return almost triple the amount taken for playing online games.
Jiyas Jamal, a Kochi-based expert in cyber law and founder of NGO Cyber Surekha Foundation, said he has been handling several cases in which children have become easy targets of online loan sharks. In several cases, the loan sharks mentally harass the children in such a way that they find it difficult to focus on their studies.
“These days, I am getting several cases from parents of the children who were trapped by the online loan sharks. Now, children use the mobile phones of parents more. In most cases, children play online games on the parents’ phones. Similarly, parents share their online payment modes like credit card/debit card, GPay and KYC details with their children. Online loan providers give `2,000-`10,000 for playing online games. Unlike loans by regular banks or NBFCs, these online loan providers don’t ask for any documentation,” he said.
However, issues pop up when the repayment starts. Most online loan firmscharge 26% to 30 % interest. Most online firms calculate interest on monthly basis. Apart from it, additional charges will be demanded when repayment starts.
“First of all, a majority of these online loan companies are not approved by RBI. An individual starts an app or website, pays a small amount to a customer as a loan and sets up a call centre to ensure the repayment. From online defamation to fake FIR, they use all fraudulent methods to ensure the customer pays the amount. Even several educated persons are getting duped by these online loan sharks,” he said.
A Keralite working with a Bengaluru-based NGO was defamed last year by sharing her photo and mobile phone number on a social media website saying she was available for call girl service after she failed to repay a nearly Rs 10,000 loan she took in an emergency situation in time. Similarly, a youth based in Kochi was defamed by claiming him that he was an accused in a sexual assault case after failing to repay the loan.
An officer with the police’s Cyberdome said a majority of online loan providers is based in North Indian states. In most cases, the targets get attracted by small loan amounts offered by these providers.
“We are receiving complaints against online loan firms. We have to come to know that a majority of victims are not coming forward with complaints as they feel ashamed. In some cases, loan providers show fake FIRs and police complaints to threaten them. They also threaten people with defamation on social media,” he said.
The police officer said loans should be taken only from RBI-approved banks and NBFCs. There are guidelines set by RBI in case of defaulting on loan repayment. “In most cases, the online loan companies won’t have any proper addresses. When we trace their mobile phone numbers and bank accounts, they turn out to be bogus. Only proper awareness will help people,” he said.
How it works
An individual starts an app or website, pays a small amount as loan to a customer and sets up a call centre to ensure repayment. From fake FIR to online defamation, they use all fraudulent methods to ensure customer repays loan.