Job and Business Opportunity for goons is ironically the success key of the bad loan recovery agents, with the emergence of unorganized loan lending applications and online websites. Such lending companies hire or outsource the loan recovery on commission or target basis to agents or employees and loan recovery is not a business vertical which employs the candidates on basis of their skill sets as ideal recovery agent, who could threaten, abuse or blackmail, with the common objective of loan recovery. “GANDA HAI PAR DHANDHA HAI YE“, a popular song from the Bollywood Thriller Movie “Company”, holds true while describing the modus operandi of such lending syndicates.

Zee Business carried the sting operation #OperationHaftaVasooli, against such money lending apps to expose unfair recovery agents and loan recovery practices, which even included Threats, Blackmail, Humiliations and Defamation to the defaulting borrowers. Some of the companies and apps that came to light during the sting operation are CashBean, YCash, OCash and WiFiCash. Aspkom Eixil Foundation also initiated social awareness campaign #loanmafia to expose such agents / money lending apps.

But here, the problem in itself raises several concerns:

• For Bad Loan Recovery, threats, abusing the borrowers, blackmailing – To what extend its legal in India. And in case it’s not legal, what are legal procedures one can follow against such lending companies.
• Can a defamation suit be filed against the Recovery Agents or Money Lending Apps? If they involve the practices of humiliating, defaming or public disclosure of the defaulter’s name or identity. Or just by hiring local goons as recovery agents they escapes the legal procedures.
• What are Identity Threats and Cyber Security Risks involved in borrowing Money from such Apps.
• Some of the recovery companies are even compromising with the privacy data of phone contacts or Whatsapp contacts to threaten them of sending their loan default status to the network and social media. It’s illegal but what actions a victim can take in such a situation.
• Late penalties, processing fees, lending rates of interest, who decides or which agency in India regulates their process. Because in Digital Age, when we allow Apps to get into Financial Transaction Business of Lending Money, it becomes mandatory to have a regulatory body to have control and hold on the practices, procedures and protocols followed.
• According to the Banking Codes and Standards Board of India (BCSBI), the collection and loan recovery policy is built on courtesy, fair treatment and persuasion, so to what extent these Loan Apps follow the policy and procedures.

Tips and Word of Caution to the Money Borrowers from any unverified app or having the bad reviews:

• Never borrow money from unverified applications or websites. Do the fact check, check the reviews on any third party website, social network (Checking testimonials on their Facebook Pages, App Pages, Website will not help as it can be easily managed).
• You, as a debtor, have certain rights. Knowing those rights will help you handle a recovery agent.
• Never share your personal details or Grant Read Permissions for your Mobile Contacts, Location or Photos to any application you are installing unless its verified and from an authentic and reliable source.
• You have a right to privacy. The recovery agent cannot discuss the debt to another person. So don’t panic if he threatens to tell neighbours or co-workers about your debt. If he does so, you can file a complaint against him with the loan lending company, report and write reviews on their Application, Social Media (Facebook, Twitter) or Google Business Pages
• You may not be a victim, but if you discover that the money lending agency or their recovery agents are engaging unfair business practices, help other victims as your initiative to help them may save several others from being trapped. Collective Social Responsibility is a key to success to exterminate any curb from society.
• Several of us create multiple social profiles; take up social responsibility to create Social Profile for the Awareness / Boycott Campaign and invite all victims and related people to join it. Intensity and Severity of an Issue is best heard when its loud enough.
• Don’t segregate in small groups for mere attention seeking, you will not reach anywhere. Open up, engage and invite others to spread awareness and lead a successful boycott campaign, only way to make a change. Driving force of evolution is entropy and as a basic rule of entropy, first step is resisting a change but once momentum is gained, it actually serves the purpose.
• Seek Legal Advice if you are being harassed and threatened, better to know your rights and consequences.

Loan Recovery is a part and partial of Finance Business and quite obvious the Recovery Process is as essential as Loan Disbursal or Processing. But any unfair practices, compromising with privacy of the money borrowers, threatening, abusing, harassment or blackmail are against law and you can seek police and legal help in these situations. Precaution and Prevention is always better than cure, but if you are already trapped, immediately seek legal help.

गंदा है, पर धंधा है ये

Unfair Practices by Such Money Lending Companies
(As Discovered by Zee Business in #OperationHaftaVasooli Sting Operation)

• Recovery is being done forcefully during the lockdown despite the government asking lenders to show a soft corner during this period.
• People are being threatened over their CIBIL scores. The recovery agents are saying that borrowers’ credit score will be spoiled.
• Borrowers are being threatened with police FIRs.
• They are being told that police will be sent to their houses if money is not paid.
• Borrowers have been sent fake circulars with RBI stamp on them.
• If none of the other tactics work, people are sent fake letters from CBI.
  To make it all appear legitimate, borrowers are sent notices on stamp paper.
• In more inhuman methods, recovers agents are threatening that your family members and friends will be informed about the loans.
• They are also abusing borrowers on phone.
• Borrowers are even receiving threats on social media platforms like WhatsApp and Telegram.