Key Takeaways
- No legitimate NBFC/Bank asks for an advance processing fee before granting a loan
- No credit check requirements is a clear red flag
- Check the authenticity of the lender before availing their offer and always apply for a loan from a genuine website only
Imagine having a disastrous credit history and still being offered a loan. You are just asked to pay a refundable processing fee. You may be hesitant to pay the advance fee, but you also don't want to let go of this "not-to-be-missed” offer. It's unfortunate that we have to break it to you, but this is an example of a loan scam! Here are some tell-tale signs.
So, what is an advance-fee loan scam, anyway?
Whether you need a loan to make home repairs, purchase a car, or for other personal reasons, in an advance-fee loan scam, fraudsters make false promises to grant you a loan or give you access to credit irrespective of your credit history. However, the catch - they will ask you to make an upfront payment as an 'advance (loan) processing fee'.
"Why do I have to make a payment before getting the loan?", you may ask the scammer.
"I am a Bajaj Finance representative, Sir. It is our company policy. But don't worry. As soon as you make the payment, your loan will be disbursed and this amount will be refunded", the scammer will invariably respond.
But guess what, it's a lie! The truth is, when someone asks you for an advance loan processing fee, there is actually no loan and definitely no lender. In fact, if you still go ahead and make the payment, both the scammer and your money are bound to disappear.
Few Things You Must Know
- Genuine lenders will never promise you a loan or any other credit without conducting a thorough check on your credit report
- Legitimate lenders will never ask you to make upfront payments. It is also true that paying an advance fee does not guarantee that you'll get a loan
- Real lenders will never share loan approval information on Whatsapp or from their personal IDs
Scammer vs. a legitimate lender. Here's How to Tell the Difference!
Most scammers may say things like, “We don't mind a bad credit score!". Don’t fall for it. If you do, there sure will be a problem - and it’s going to be yours.
In such cases, it’s important to remember that no legitimate bank, NBFC, or lender will ever promise or guarantee you a loan or credit before you apply for it. Once you apply, they will conduct a thorough check on your credit report and then decide whether or not you can repay it on time. This is a standard procedure and requires some time. Remember, haste makes waste. So, if the lender (read: scammer) is trying to rush you into making an upfront payment to avail a loan, it’s a scam! In fact, any sort of upfront fee that the lender is asking you to pay before granting the loan is the single most vital cue to walk away.
Paid a scammer? Here’s what to do!
Fraudsters usually ask you to make upfront payments in a way that makes it almost impossible to get your money back. Online fraud is usually untraceable, and money once lost is lost forever. So, regardless of how you paid the scammer, the sooner you act, the better! You can learn about the latest RBI guidelines against online frauds to understand how to handle things if you’ve paid a scammer.
How do you report advance-fee loan scams?
If you have been receiving scam calls from tele callers impersonating Bajaj Finance representatives, or have lost money to an advance-fee loan scam, make it a point to report it at your nearest police station and on the cybercrime portal. Also, ensure that you reach out to Bajaj Finance and report the crime. When you report these scammers, you also contribute to the law and alert others against such scams.
