On December 16 afternoon, P Sunil, 24, hugged his five-month-old son for a long time as he and his wife Ramya, 23, watched TV at their home in Kismatpur in Hyderabad. Then, he went into another room, and hanged himself.
In the days since, the police have found that on that morning, Sunil had received dozens of phone calls and messages from numbers linked to instant loan apps. “I knew he had taken loans through the apps. He was unable to repay as he had lost his job during the lockdown, and he got calls continuously, even at night, full of abuses. They threatened to file FIRs, to lock his bank account, defame him. He was worried all the time. To repay one loan, he took another, and ended up with over Rs 2 lakh debt,” says Ramya, now at her in-laws’ house in Guntur district of Andhra Pradesh.
In the past few days, the Telangana Police has received at least 90 complaints from similar victims, who borrowed money through apps that clear loans within half-an-hour, charging a high interest, and believed to be working in tandem. A defaulter is subjected to constant harassment, over phone, including messages of fake FIRs and court notices, and humiliated before friends and relatives. There have been reports of three suicides, and one attempted suicide.
The police of Hyderabad, Cyberabad and Rachakonda in Telangana have written to Google to take down 158 instant loan apps from Google Play Store. The Telangana Police has raided offices and call centres in Hyderabad, Bengaluru, Pune and Gurugram, from where hundreds of staff members made calls to customers. The 14 arrested include a Chinese national, behind allegedly 11 of the apps.
Cyberabad Police Commissioner V C Sajjanar said they fear “thousands may be suffering the abuse and harassment silently, afraid to seek help”. A preliminary investigation has revealed close to 1.4 crore transactions worth nearly Rs 21,000 crore, as per a Hyderabad Police release, reported by PTI.
D Balraj, Sub-Inspector at Rajendranagar Police Station, who is investigating Sunil’s case, said Sunil had 30 instant loan apps. “Due to the high interest rates, he had to repay almost double the amount he had borrowed. He got a new job and was to join a week later, but the recovery agents had started calling up his contacts.”
Sunil used to work as a developer at a gaming company at Madhapur in Hyderabad, before he was laid off. He initially used a credit card to pay his bills, but when the dues mounted, started borrowing from instant loan apps.
Before she consumed pesticide on December 12, Kirni Mounika, 24, sent a message to the Fly Cash instant loan app, one of 55 on her phone, saying, “Already you spoiled my life.” Four days later, Mounika, the sole earning member of her family, with three younger brothers who are still studying, was dead.
After a B.Sc in Agriculture, Mounika had joined work as an agriculture extension officer in Rajgopalpet village in Telangana, earning Rs 37,000 per month. “She was lively, hardworking. She had joined two years ago and was already a role model among young officers,” says P Sravan Kumar, District Agriculture Officer.
Apart from taking care of household expenses, Mounika’s salary paid for the tuition and hostel fees of her three brothers. The police have found that she first borrowed Rs 16,832 on November 1 from Cash Bean. As the due date of November 7 arrived, she borrowed Rs 22,000 from Credit Bean on November 5. “From November 1 till December 9 she borrowed Rs 2.71 lakh, of which she had repaid about Rs 2.50 lakh. From the way the money, ranging from Rs 2,800 to Rs 7,000, was deposited in her account, it seems that she took a loan from one app to repay the other. Also, some apps appear to have pressured her or talked her into downloading new apps. She kept repaying till December 9, by which time she owed more than Rs 1 lakh as interest and the apps had started sending messages to her contacts,” said Rameshwar Rao, ACP, Siddipet Division.
After this, the police said, Mounika stopped borrowing and sent messages seeking two-three days’ time. Like found in other cases, the recovery agents then deployed a combination of tactics — they made hundreds of calls and flooded her phone with text and WhatsApp messages, sending fake FIRs, bogus court notices, and fake letters marked to the RBI to block her bank accounts, Aadhaar and PAN. On December 11, they sent messages to the contacts in her phone, including her best friend Sahaja and her mother. On December 12, while she was packing to attend Sahaja’s marriage at Warangal, the instant loan apps started sending messages to WhatsApp groups of her office colleagues and relatives with her photo, branding her as a defaulter. At 5 pm the same day, Mounika consumed pesticide.
Mounika’s father Kirni Bhoopani is an ex-sarpanch, and while not well-off, the family had some political connections in Nangunur Mandal. “I don’t know why she took those loans. If I had known, I would have stopped her,” says Bhoopani.
Not knowing that she is dead, recovery agents have been making at least 40 calls daily and sent at least 250 messages in the last few days to Mounika’s phone.
Two days after Mounika’s death, D Santhosh, 36, consumed pesticide at his home in Malkapur, after sending a selfie-video to his friend B Subramanyam saying he had got trapped in a debt cycle. On December 23, Santhosh passed away. “He blamed five instant loan app companies. If he ignored their phone calls, they called his family members… It seems there was not a minute’s respite,” Subramanyam says.
Santhosh worked as site in-charge at S L Trans at Ramagundam Fertilizers and Chemicals Limited. He lived alone, with his family settled in Visakhapatnam. “During the lockdown he borrowed money. He repaid most of it but was caught in a cycle. He took Rs 9,319 from Udhaar Loan; Rs 9,197 from Rufilo; Rs 4,230 from Reepay; Rs 16,660 from AAA; and Rs 11,770 from Loan Gram. He ended up with a debt of Rs 51,176, the interest which was another Rs 50,000,” DCP P Ravinder said.
According to the police, most of the instant loan apps don’t have RBI approval. Police Commissioner Sajjanar said, “Once a person avails a loan, other app operators talk them into taking more loans. In many instances, after a customer has repaid the full amount, more sums are credited without a customer asking for it. The app operators set the trap carefully, not revealing all the details. If a person is in urgent need of Rs 5,000, he or she will get only Rs 3,800 or so, after deduction of ‘processing fees and GST’. Customers are hence forced to take loans from other apps.”
Having secured consent to access the contact list, photos, documents etc while clearing the loan, the apps have such details with them.
The call centres raided belong to, among others, Liufang Technologies, Hotful Technologies, Pinprint Technologies and Nabloom Technologies, registered in Bengaluru; and Onion Credit, CredFox Technologies Pvt Ltd and Digipeergo Tech Pvt Ltd, in Hyderabad. Digipeergo is owned by Chinese national Zixia Zhang. In Pune, police raided Jiya Liang Infotech, which was operating 10 instant loan apps.
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