ISLAMABAD , July 18, 2023: The Ministry of Information Technology and Telecommunication (MoITT) has taken a significant step by launching a crackdown on illegal loan apps functioning in the country, The News reported Tuesday.
As a result, 43 apps in this category have been promptly blocked. According to Federal Minister for IT and Telecommunication Syed Amin Ul Haque, the ministry has swiftly implemented instructions to block these apps.
Additionally, the minister emphasised the importance of launching an awareness campaign to prevent people from falling victim to such fraudulent activities.
The statement further stated that individuals should report complaints to relevant authorities — including the PTA, FIA Cybercrime, and local police — to take appropriate action against these illegal loan apps.
According to MoITT, the IT minister has also made contact with the FIA with directions to take action against such elements instead of waiting for complaints.
In a rising trend, many scammers are launching “easy loan” applications on Google Playstore and Apple iStore; however, as easy and convenient as the loans may seem — given that they do not require extensive paperwork — these applications are proving to be a menace to countless people.
The suicide of an unemployed man in Rawalpindi earlier this week has brought yet another scam to the foreground.
Experiences like his are increasing as more people in the country of 220 million turn to dozens of mobile-based lenders, creating fertile ground for scams and fraudsters, digital rights and consumer defence groups say.
Reflecting a jump in smartphone use, the number of Pakistanis using personal finance apps more than doubled to 19% in 2022 from two years earlier, boosting low rates of financial inclusion, found a survey earlier this year by Karandaaz Pakistan, a nonprofit.
FIA’s moves against loan apps
Meanwhile, FIA, during country-wide operations against illegal loaning companies, has registered 74 cases for enquiries on the complaints lodged from the effectees and registered three FIRs against the individuals and companies.
It arrested 17 suspects running illegal online loan schemes from various cities and blocked 30 accounts.
FIA cybercrime wing has sealed five offices of the companies involved in this illegal activity, the FIA spokesperson said Monday.
FIA Director General Mohsin Hassan Butt has directed all field units of the cyber crime wing to take strict action against companies and individuals offering loans through unregistered and illegal mobile applications.
The FIA DG, when contacted by this correspondent, said he has asked to take strict action against those involved in such unlawful financial activities.
“Companies obtain the licence from SECP for online loan payment apps,” the DG said and added that the SECP is the registration and regulatory authority to issue licences to non-banking financial companies (NBFC) to give loans through online apps.
Moreover, the PA) coordinates with Apple and Google to remove illegal Apps involved in micro-financing in Pakistan.
The crackdown is throughout Pakistan, DG FIA maintained, asking the citizens to check the SECP website to confirm whether the company app is licensed.