FAQs about Education Loan Scams
How can I verify if a loan company is genuine?
Make sure the lender is officially registered with the Reserve Bank of India (RBI) as either a bank or a recognised NBFC. You can check the RBI's official website for the list of registered financial institutions.
Are all online loan companies fake?
No, many legitimate financial companies and NBFCs offer online loan services. The key is to verify their credentials and check for red flags like upfront fees or unrealistic promises.
What are fake loan companies in India?
Fake loan companies in India are fraudulent entities that operate without a valid license from the RBI. They often use fake names, provide no physical address, and engage in illegal practices like harassment and data theft.
What should I do if a company asks for my bank account details for verification?
A legitimate lender will only ask for your bank details for disbursal after your loan has been approved, not for a "verification" process. Providing such details beforehand is extremely risky.
Are student loan debt relief companies legitimate?
Most student debt relief companies are fraudulent. You can work directly with your lender to restructure your loan or explore government-approved programmes for debt relief. You never need to pay a third party for these services.
What is the difference between a loan scam and identity theft?
A loan scam is a broader fraud, whereas identity theft is a common result of a scam. Scammers often commit identity theft by stealing your personal information during a scam and then using it to take out loans in your name.
Can I get an education loan with a bad CIBIL score?
While it's difficult, some lenders may consider providing an education loan with a co-applicant or guarantor, even if you have a low CIBIL score. However, be extremely cautious of anyone who promises a loan without any credit check.
I got a call saying my loan is approved, but I never applied. Is this a scam?
Yes, this is a very common type of loan scam in India. Legitimate lenders do not offer "pre-approved" loans without an application. They will never contact you out of the blue with a guaranteed offer; this is a tactic to get your personal information.
A company is asking for a small "application fee" to process my loan. Is this normal?
No, this is a major red flag for education loan scams. Legitimate financial institutions do not charge an upfront fee for processing an application. Any fee is typically deducted from the sanctioned loan amount after it is disbursed.
A website is asking me to provide my Aadhaar and PAN details to fill out a loan application. Is it safe?
It is safe only if you are on the official, verified website of a genuine lender. Scammers generally use this tactic to create fake websites that look real to collect this information. Always double-check the URL and look for a padlock icon to ensure the website is secure before entering sensitive data.
I think I've already been scammed. What should I do?
Act immediately. Stop all communication with the scammer, report the scam to the National Cyber Crime Reporting Portal (cybercrime.gov.in), and inform your bank to freeze your account and prevent further loss. You should also file a police report.
I'm worried about my information being leaked. How can I protect my documents?
When submitting documents, use secure portals provided by the lender. Be cautious about sending documents via unencrypted email. Also, make sure to check your credit report regularly for any suspicious loan inquiries or accounts opened in your name.
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