Thane Businessman Loses Rs 22 Lakh In Loan Scam: How To Avoid Loan Scams

A businessman from Thane recently lost Rs 22 lakh to a scammer who had promised him a Rs 10 crore loan. The scammer made him believe in his networks, took repeated payments in the form of processing fees and commissions, and vanished without setting up any loan. Such frauds are now becoming extremely common, targeting those in hopeless financial crises.

How Loan Frauds Work

Scammers typically promise large loans with less documentation and no credit check. They also claim in-house arrangements with banks or other financial institutions. To make the offer seem legitimate, they request payments in different forms—processing fees, insurance, and legal fees—prior to loan disbursal. The scammer either disappears after the victim pays or provides false loan documents after the victim pays. The majority of the victims realise the scam when the promised loan is never disbursed.

Red Flags to Watch Out For

The most common red flag for a loan scam is a request for an advance payment. Any genuine lender subtracts fees from the approved sum and not request payments in advance. Unsolicited calls, emails, or WhatsApp loans, particularly with guaranteed approval, should also be looked at with suspicion. Fraudsters also create an environment of urgency, allegedly making limited-period offers to entangle victims into making quick payments. If the lender has no address, is not registered with RBI, or avoids paperwork, it's definitely a sign of fraud. 

Before dealing with any lender, verify their credentials. RBI’s website lists registered financial institutions, and reviews from other borrowers can reveal past complaints. Never transfer money upfront for loan approvals, and always insist on written agreements. Personal information such as Aadhaar, PAN, or bank details should only be shared with verified lenders. If in doubt, consult a financial expert or contact the bank directly.

What To Do If You Get Caught?

When you get victimised by a suspicion of fraud, report it immediately to the portal of cybercrimes (cybercrime.gov.in) or the police. Inform your bank if there had been a sharing of financial data so that they can block any potential misuse. Tipping off the financial regulators against suspicious lenders helps warn others and prevent them too from getting scammed.

Loan scams exploit desperation, promising easy credit and draining savings from victims. Awareness, verification of credentials, and not paying upfront fees are the keys to avoiding such traps.

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