Taking a personal loan online is quick and easy, but it also means sharing sensitive financial and personal data on the internet. From your PAN card details and bank account statements to proof of employment, this data can be at risk if the lender or website is insecure. Find out what you need to know before you click "submit."
How lenders handle your personal data
Well-known banks, NBFCs, and RBI-registered fintech lenders encrypt your data when transferring and storing it, using secure servers. They must adhere to data protection principles and observe confidentiality. But unknown or unregulated platforms might not adopt the same practices, and the risk of misuse rises.
Risks of unsecured applications
If you give information on an insecure website or app, your data can be captured by hackers. It is used for identity theft, false transactions, or for a phishing attack. A serious-looking website might also be fake, so you must check for authenticity before entering your details.
What to check before applying
Look for "https" in the URL of the website, a visible padlock symbol, and two-factor authentication upon login. Check that the lender is registered with the RBI (for NBFCs) or is a bank having the approval. Look at the privacy policy to understand how your information will be handled, and avoid giving excessive permissions to mobile applications.
Be cautious while uploading documents
When you upload scanned copies of documents like Aadhaar or bank statements, mail them using secure channels. Do not send them via email or instant messaging unless you are positive about the authenticity of the recipient. Some apps allow you to conceal Aadhaar numbers for added protection.
Making yourself secure after applying
Even after you have submitted your application, keep an eye on your bank accounts, email, and credit report for any suspicious activities. In case you suspect misuse of data, report to your bank, change passwords, and alert the concerned cybercrime portal.
Balancing convenience and safety
Online loan applications are convenient and offer instant approval, but the security of your information depends on the lender's security processes and your own precautions. By sticking to safe platforms and taking easy security precautions, you can limit the dangers without compromising the convenience of online lending.
FAQs
Q. How can I check whether an online lender is legitimate?
Verify whether the lender is a RBI-registered NBFC or a scheduled bank. Verify official contact details, review websites, and check their RBI registration number on the regulator's website.
Q. Is it safe to share my Aadhaar online for a loan?
It is safe if done on the secure platform of an RBI-regulated lender. Masked Aadhaar wherever possible, and never share it on unverified websites or apps.
Q. Will third parties be able to buy my loan application information?
Legitimate lenders explain in their privacy policies what they do with your information. They may make information accessible to approved third parties, but they are not allowed to sell your information without consent under current rules.
Discover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
