Priya PatelTLDR:
- Zerodha co-founder Nithin Kamath shared the personal account of a victim of loan sharks and cautioned people to stay away from loan apps with red flags.
- Kamath mentioned some ways to identify fake and shady loan applications, including granting unnecessary permissions, not reading the terms and conditions, and high-interest rates.
Zerodha co-founder Nithin Kamath has warned people about the dangers of using illegal finance apps and shared the story of a loan shark victim to illustrate the risks. Kamath highlighted the existence of digital lending applications that lure people with attractive schemes and then threaten them for repayment of loans at exorbitant interest rates. He urged the public to be aware of the red flags associated with such apps and to exercise caution when using them.
According to Kamath, a major warning sign is the indiscriminate granting of permissions to these loan apps on mobile devices, such as access to contacts, media, images, microphone, and location. He advised users to carefully review the terms and conditions policy of the loan app and to be cautious if they cannot find any background information about the app online. Other key red flags include the absence of loan agreements and proper KYC procedures, immediate money transfers to bank accounts without any paperwork, and extremely high-interest rates and hidden charges.
Kamath emphasized that it is crucial for individuals to verify the legitimacy of loan apps before trusting them with personal information or borrowing money. By raising awareness about the risks associated with illegal finance apps, Kamath hopes to protect people from falling into the traps of loan sharks and suffering financial harm.
