Diwali 2026: Beware of instant loan offers on WhatsApp and social media; 5 ways to avoid loan app scams today
The nation celebrates the auspicious festival of Diwali today. This is a day that often brings higher spending, understandable thrill and euphoria around bursting crackers, as households shop for festivities and purchase essential gifts, clothes, chocolates, and similar items.
However, the rush for urgent funds can also make individuals vulnerable to cyber fraud and financial scams, as fraudsters exploit these vulnerabilities by offering quick, seamless-looking loans through fraudulent mobile applications.
This issue has been recently discussed in detail in a report by The Tribune. In the report, it has been explained how cybercriminals in Himachal Pradesh are targeting young and unsuspecting borrowers, particularly college students and young graduates, with ‘instant loan offers’ before utilising their submitted personal information to threaten, blackmail and steal money from them.
According to a report by The Tribune, scamsters first advertise instant loans of ₹5,000 to ₹10,000 on well-known social media platforms, via SMS, and through WhatsApp links. The primary aim is to first reach the targeted victim and to convince them to apply for the loan.
After the disbursal of funds, i.e., the loan amount, they demand repayments several times higher than the initial loan amount, and when the borrower denies or rejects such forced instructions, the borrower’s photographs, personal details, contact numbers, videos and other similar confidential information are utilised to threaten and blackmail them.
Keeping in mind the basics of how such scams work, here are several critical precautions individuals should take this Diwali to avoid falling for a loan application scam.
In order to protect your financial well-being and personal information from unauthorised use, you should ensure that you never trust loan advertisements promising quick and seamless approvals without verifying them carefully. Make sure that you apply for a fresh loan only through an RBI-regulated entity or bank, even if the applicable interest rates are higher and the process of loan clearance and approval is longer.
Fraudulent loan applications generally reach users through social media platforms, unsolicited text messages, WhatsApp forwards, link-sharing, APK files, etc. To keep things in check, never click on unknown links or download applications from unverified and illegitimate websites and sources. Always use official application stores and check the developer's credentials. This is vital to protect your financial and personal data, along with your credit score and overall credit profile, from being misused or exploited.
Never permit any loan application with ‘complete’ and ‘unrestricted’ access to your mobile device. There is a need to protect your contact list, personal photos, personal chats, text messages and WhatsApp exchanges at all times. Read the permission requests carefully and ask yourself, before granting permission, what need this application has to access my contacts? Photos? etc. Sharing sensitive information and personal details can result in exposing you to threats, harassment, identity theft, blackmail and even life-altering difficulties.
Never disclose banking passwords, OTPs, PINs, internet banking details, or other similar confidential forms of data with anyone. No bank ever asks for such information. If requested to share Aadhaar, PAN and bank-related details, share them only with legitimate, RBI-backed lenders, after investing time and carefully verifying the lending institution's authenticity and understanding why the information is required.
Finally, if you still face persistent threats, personal messages, calls, emails, legal and police action threats, detention warnings, physical violence threats or other forms of personal attacks, etc., due to loan application fraud, you should promptly report it by calling the national cybercrime helpline number at 1930. This can also be done by visiting the official National Cyber Crime Reporting Portal. Also preserve all forms of communication, such as screenshots, transaction details, messages, emails, phone numbers, and other digital evidence, to support your claim and protect your personal and financial integrity.
In summary, festive borrowing should never come at the cost of one’s peace of mind, personal privacy, or financial security. Before accepting an instant loan offer today on Diwali, check the lending institution's credentials, review the application permissions, and read the repayment terms carefully. A few simple precautionary steps can protect your money from theft and your personal details from misuse.
Shivam writes on personal finance, equity markets, and mutual funds. He has previously contributed to several leading publications, including Moneycontrol. He can be reached at shivam.shukla@htdigital.in
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