It has been quite an issue of trust on the moneylenders for years. It is due to the unlicensed or Illegal money lenders present in the market. These unlicensed firms have mistreated the borrowers in the past, causing a trust issue among them.
Here a question arises, is moneylenders safe? A licenced moneylender is government-controlled and always trustworthy. Here we have discussed some points regarding the safety of borrowing money from licenced moneylenders.
The law governs licensed Moneylenders:
Licenced Money Lending is controlled and governed by the law. Including terms and conditions to the contract, everything is gone through government agencies and kept in the best interest of borrowers.
The Moneylenders Act protects not only the borrowers but also the loaners. It controls the unsecured loans, unauthorised firms, advertisements and gives access to borrowers to check the authentication of the firms.
Most importantly, moneylenders act to protect a borrower in the following way
- Against any threatening action or abusive language.
- Requesting any kind of ID password details
- Withholding important documents, including ATMs, ids, Passports etc.
- Approving the loan without examining the documents.
- Imposing the charges, which was not discussed at the time of the loan issue.
- Issuing loans without giving loan contracts, etc.
Unsecured loans are those in which the borrower has mortgaged no property or asset to the loaner in case of fault. In such scenarios, the government has restricted the loan amount to nearly six times the borrower’s income.
Licensed moneylenders are very professional and controlled by the government. In collecting the amount, they do not harass or employ such tactics. Such repayments are handled by professional debt collectors when there is no consideration of court proceedings. These collectors are obliged to government Agencies that ensure professional behaviour in the collection of amounts. Also, Harassment or intimidating a client with or without the approval of government Agencies is unlawful activity.
Although licenced Moneylending is safe, one should know how to identify and distinguish between licenced and unlicensed firms. Also, instead of the available and accessible information, many fraud cases have been seen. To control these cases, Police have issued information about illegal moneylenders. Everyone should be aware of these.
Scams related to Moneylending:
The best way to avoid the money lending scams is to get connected with the safest and top money lending firms, like CRAWFORT PRIVATE LIMITED.
Receiving messages from illegal organizations claiming to be a part of the licenced firm, asking for an advance amount to clear the loans.
Victims receive a PDF version of the documentation in other forms, which looks like authorized papers and are asked to pay GST payment or processing amount.
Instructions to avoid scams:
- No licenced firm will send text messages or calls to public members.
- A loan process may start online by a licenced firm, but the approval of the individual and the documents should be done personally at the office of the licenced money lending firm as it is compulsory for the firm to have a physical office and proceed with any money lending only after the approval of the client in person. The public has to make sure that before this physical approval, they do not proceed with any kind of payment to the firm.
- Public has to be careful in paying anything to money lenders before the loan is granted. These illegal firms may ask you to pay in any form, and it may be GST amount, processing fees, admin fees before the loan are granted. After the loan allotment, a licenced firm may ask you for administrative fees, but that too can be deducted from the principal loan amount.
- No calls or messages should be entertained as advertisements from money lending firms. Also, such calls should be reported and blocked.
- Never give out your personal details or ATM card details on such calls.
Finding a licensed money lender is very important while you are planning to take your personal loan, car loan, or any other loan because license moneylenders abide by the government regulations which perform under a set of rules. You should always check for their verification and id’s.