SUMMARY
This action aligns with the government's ongoing initiatives to combat fraud loan apps and safeguard consumers from financial scams
Google examined roughly 3,500 to 4,000 loan applications from April 2021 to July 2022, suspending or eliminating over 2,500 of them from the Play Store
Google has updated its policy regarding enforcement of loan apps on the Play Store
Google has removed more than 2,200 fraudulent loan apps from its Play Store between September 2022 and August 2023, the government informed the Parliament.
This action aligns with the government’s ongoing initiatives to combat fake loan apps and safeguard consumers from financial scams.
The government is constantly engaged with the Reserve Bank of India (RBI) and other regulators and stakeholders concerned with controlling illegal loan apps, Minister of State for Finance Bhagwat K Karad said in a written reply to Rajya Sabha.
According to the Ministry of Electronics and Information Technology (MeitY), Google examined roughly 3,500 to 4,000 loan applications from April 2021 to July 2022, suspending or eliminating over 2,500 of them from the Play Store.
“The objective is to remain proactive, maintain cyber security preparedness with constant vigil and take appropriate & timely action, to mitigate any such vulnerabilities in the Indian financial system,” the minister said.
Further, Google has updated its policy regarding enforcement of loan apps on the Play Store and only those apps are allowed on the Play Store which are published by regulated entities or those working in partnership with the REs. It has also deployed additional policy requirements with strict enforcement actions for loan apps in India, the minister noted.
Meanwhile, RBI has issued regulatory guidelines on digital lending, which aims at firming up the regulatory framework for digital lending, while enhancing customer protection and making the digital lending ecosystem safe and sound.
The Indian Cyber Crime Coordination Centre (I4C), Ministry of Home Affairs (MHA) has also been proactively analysing the digital lending apps.
Loan Apps Under Government Scanner
The government has been taking various measures to combat loan apps through various initiatives such as sharing safety tips on social media, distributing handbooks, and organizing awareness weeks with states/union territories.
In addition to these, RBI and Banks have also been taking cybercrime awareness campaigns through dissemination of messages on cyber-crime through short SMS, radio campaigns, publicity on prevention of ‘cyber-crime’. Further, RBI has been conducting electronic-banking awareness and training (e-BAAT) programmes which focus on awareness about frauds and risk mitigation.
The ministry of corporate affairs is reportedly considering cancellation of registration and freezing accounts of Chinese loan app operators if a probe shows that they have committed fraud.
The investigation wing’s zonal teams within the ministry are concluding their initial reports on searches and raids carried out at the locations of Chinese loan app companies, accused of engaging in fraudulent, extortive, and harassing practices towards borrowers.
The government has also directed social media and other digital platforms not to carry advertisements of fraudulent loan apps. MeitY issued an advisory to social media platforms asking them to take additional measures to not permit any advertisements of illegal loan and betting apps that have the potential to scam and mislead users.
As per Inc42, the Indian digital consumer lending market is projected to grow to an addressable market size of $720 Bn by 2030 led by favourable socioeconomic factors and timely regulatory measures.
