The instant loan app said customers can get a moratorium by requesting one via email or Twitter. However, the client claims that he was never informed of this.
Hyderabad resident Shrikar Manne, self-employed in the real estate industry, on April 15 missed an EMI loan payment of a loan he took over on an instant personal loan application application. What followed, he says, was harassment over the phone by the Mumbai-based company.
“They invaded my phone, got access to all my contacts and called everyone on my contact list. The company told my contacts that I had given their names as a reference when taking the loan “, Alleges Shrikar, who claims that the company had made more than 200 such calls to its contacts. “It’s illegal and unethical. They defamed me and my reputation everywhere, “adds- he.
Shrikar had taken out a Rs 50,000 loan from Kissht, a company that offers instant personal loans payable through EMI. Apart from instant loans, the company also offers instant interest credit. The company is one of many such instant loan apps available on the Google Play Store and was pushed to Shikar via Makemytrip, the travel aggregator service as part of an exclusive combination between the two companies.
Applications that provide instant loans fall under the category of Non-Banking Financial Companies (NBFCs) which, like banks, have been allowed to grant borrowers a three-month moratorium. In March, RBI announced that all banks and credit institutions can allow a three-month moratorium on all outstanding term loans from March 1, 2020. This includes all forms of retail loans and EMIs. This was later extended for another three months until August 31, 2020.
However, borrowers claim that several instant loan providers have been urging their borrowers to cough up their monthly EMIs on time. These companies, which had in the past been accused of using bullying tactics for EMI recoveries, reportedly continued this even during the lockdown, when many businesses and jobs were affected. Some have even been threatened with legal action.
Thousands of our customers have already taken advantage of the moratorium and other payment deferral options.
— Kissht #EMIWithoutCreditCard (@Kissht_EMI) April 24, 2020
Users of several instant lending platforms have taken to social media throughout April and May to highlight the various ways they have been threatened and harassed by these app-based lending companies.
Live Mint reported that these credit lending fintech apps are not regulated by the Reserve Bank of India and that guidelines on how they operate are ambiguous. However, these loan apps are among the most downloaded in India.
— Samita Shrivastava (@SamitaShri) April 24, 2020
In a 2020 report, AppsFlyer, an app tagging platform, noted that India has the highest number of financial app installs in the Asia-Pacific region, with lending apps dominating the number of downloads. . About 64% of the total financial apps downloaded in the country were loan apps.
The service of the moratorium was never communicated
Shrikar says he intended to repay the loan from Kissht, an app that provides instant personal loans payable through IME, once his business is back to normal.
“I have been told that my credit rating is good and therefore I am eligible for an instant personal loan of Rs 50,000 with a duration of one year”, explains the businessman. He was eligible for the moratorium, but claims he was never informed of the moratorium option offered by the company.
Only given the name of the moratorium for 6 days and threatening with a legal case, what is it pic.twitter.com/fpnHF24TJg
— Ravi Dutt (@RaviDut79245867) April 24, 2020
On April 24, Kissht tweeted that customers could get a moratorium by requesting one via email or DM on Twitter.
“But I never received any communication about it via text message. The only communication I had was that they were asking me if I could afford at least a month of EMI,” says Shrikar, who says that he no longer intends to repay the loan after the humiliation.
“I intend to bring them to civil justice or consumer court for the humiliation they have caused. I was unable to file a complaint with the police due to the lockdown,” says an agitated Shikar, who like others has also taken to social media to speak out against the harassment.
Many app users have taken to social media to record similar instances of calls to their phone contacts from unknown numbers asking Kissht for EMI reimbursement. Most did not know how to proceed legally.
Shrikar had to call each of his contacts and explain in person to a few others that he hadn’t kept them as collateral for a loan. “It’s for an EMI jump, which is embarrassing; it hurt my reputation and it’s not like I’m not going to pay,” he adds.
Many others, like Shrikar, who had taken out loans and were unable to pay their IMEs due to loss of income, took to social media to point out that they were not in able to avail itself of the moratorium provided by the RBI.
Dear customers, we have noticed that few of our users have reported receiving late night calls from international numbers requesting EMI payment.
Rest assured that Kissht never calls its customers from an international number. (1/2)
— Kissht #EMIWithoutCreditCard (@Kissht_EMI) April 28, 2020
In response to allegations of customer harassment by Kissht’s customer service managers, the company’s head of product and digital marketing, Manmeet Singh, denied any wrongdoing on the company’s part and added that they had never insisted on EMI payment despite having a moratorium option available.
“We have offered a moratorium to 1.5 lakh customers. The government’s first announcement came in March, the first days we tried to figure out the details of the moratorium. We had discussions between the NBFCs and understood that the interest can be borne by the customers and that is exactly what the moratorium really means”.
The company representative claimed that at no time did they force their struggling customers to make payments. “We realized there was resentment against companies that couldn’t offer the moratorium. We have also ensured that our line of communication with customers is open. If they contact us, we will always respond. We also provide ways in which they can benefit from the moratorium,” Manmeet added.
Srikanth L of Cashless Consumer, a consumer collective focused on digital payments, told TNM that the pressure felt by borrowers could be the result of these NBFCs themselves taking out loans to provide the lending service. in the first place, but may not be eligible for a moratorium themselves.
“For normal people, who take out these loans but are unable to pay and are often harassed, going to court would mean they have to take out another loan to pay for a lawyer. Thus, many do not file a complaint, ”adds Srikanth.
“These firms will put pressure on the collection agents who must keep their jobs. Due to the pressure, collectors often resort to such recovery tactics,” he says.
The researcher warns that these apps, when installed on a phone, not only collect contact details but can also track calls to find who is contacted the most. Some apps are even accused of embedding tracking software into other apps to monitor spending, GPS locations and data are often used to determine a potential borrower’s creditworthiness.
In the absence of any action from the RBI, several Twitter users are also trying to get these apps removed from Google Play Store. Some of the digital loan apps especially payday loan providers are available on play store although play store has a content policy for developersexcept for businesses that only provide short-term personal loans that require payment in full within 60 days or less from the date the loan is issued.
In response to allegations that the company collected phone details from its customers, the company’s representative said: “We don’t access contacts from the phone, but we delete contacts and verify keywords. , GSP and total number of contacts and determine creditworthiness. We do not access contacts. We take these accusations seriously; we will investigate this.