Some cash loan platforms have ambiguous interest calculation methods, so beware of cash loan traps

Some "cash loan" platforms use mobile apps, WeChat and other channels to find borrowers who are in urgent need of money. They use service fees and other names to obscure the interest calculation method, cover up abnormally high interest rates, and charge high penalty interest. Industry insiders remind that loans with annual interest rates within 24% are protected by national law. Borrowers must live within their means, carefully understand the borrowing process and precautions before borrowing, choose an institution or platform with high credibility, and protect personal information.

For some time, small cash loan business has been popular. This kind of loan is usually applied through online loan platform. It has short term, low amount and fast payment. It is called cash loan and was once popular in the market. However, some criminals, under the guise of “inclusive finance”, issue high-interest cash loans and obtain improper gains, using extremely concealed methods.

Recently, the Shanghai Financial Services Office discovered through the complaint channel that some "cash loan" business platforms use slogans such as "low interest", "no mortgage" and "quick lending" to induce others to apply to the platform For loans, these platforms often charge high fees and extremely high interest rates, and are accompanied by illegal behaviors such as "violent collection" and "malicious collection".

The person in charge of the petition department of the Shanghai Financial Services Office said that borrowers should keep their eyes open, recognize the main methods of "cash loans", beware of being deceived, and avoid illegal infringement.

According to reports, the usual method of "cash loan" business is to find borrowers who have no access to loans and are in urgent need of money through mobile APP, WeChat, QQ and other channels, carry out small-amount loan loans and agree on repayment the term. Some platforms use service fees, management fees and other charges to obscure interest calculation methods, secretly change concepts, cover up illegal activities such as abnormally high interest rates and charge "cut-off interest", and some even deliberately set up technical obstacles to prevent borrowers from repaying their loans. Overdue, high penalty interest will be charged. These loan companies often require access to the borrower's mobile phone address book when handling loan procedures. If the borrower does not repay the unusually high principal and interest as well as overdue penalty interest, these loan companies will entrust illegal collection companies to use various methods such as Internet calls and text messages. Bombing harassment of borrowers and their mobile phone address book contacts. Some companies even forge and publish personal portraits for defamation, and at the same time, accompanied by violent collection, threats, intimidation and other illegal behaviors, force borrowers to return abnormally high principal and interest.

The Shanghai Financial Services Office, together with the financial regulatory authorities, administrative law enforcement departments, and judicial authorities, has carried out centralized rectification of this issue. Analyzing complaints from the masses and big data monitoring information, we sorted out more than 30 platforms suspected of carrying out "cash loan" business in Shanghai, focusing on characteristics such as "no scene support, no designated use, no customer group restrictions, and no mortgage" The "cash loan" business will be rectified and standardized.

Industry insiders remind borrowers that according to the "Regulations of the Supreme People's Court on Several Issues Concerning the Application of Law in the Trial of Private Lending Cases", loans with annual interest rates within 24% are protected by national law. Those who charge high fees in violation of regulations, as well as malicious collections, violent collections and other illegal activities can also be reported to the China Internet Finance Association reporting platform. If it is discovered that illegally raised funds such as illegally absorbing public deposits, absorbing public deposits in disguised form, etc. are used to issue private loans, and illegal means such as intentional injury, illegal detention, insult, intimidation, and threats are used to collect collection, the parties concerned can also report it to the local public security organs.

In addition, borrowers should live within their means and be wary of the risks that may arise from personal over-indebtedness. Before borrowing, you should carefully understand the borrowing process and precautions, and try to choose a bank or online loan platform with high credibility, standardized and legal management and legal operations. Especially when applying online, borrowers must carefully review the loan contract to understand the loan conditions and interest rates, and at the same time protect personal information, including mobile phone address books, personal bank card information, etc.