ISLAMABAD: Google has introduced a new policy for personal loan applications with the commitment of protecting consumers across Pakistan from fake and unregistered lending apps, the global tech giant said on Tuesday.
Google allows a Non-Banking Finance Company (NBFC) lender to publish only a single Digital Lending App (DLA). Those who attempt to publish more than one DLA are liable to be terminated from their developer account and any other associated accounts, according to Google policies effective since May 31.
Developers with personal loan apps targeting users in Pakistan must complete the Personal Loan App Declaration form and submit the necessary documentation before publishing their app. They must submit proof of approval from the country’s capital market regulator, the Securities and Exchange Commission of Pakistan (SECP), to offer or facilitate digital lending services in Pakistan.
However, the tech giant has further strengthened its policies after complaints that these digital loan sharks have been extorting money from Pakistanis through threats and blackmail.
“Google Play will also request additional information or documents relating to loan app compliance with the applicable regulatory and licensing requirements,” it said in a statement. “Personal loan apps operating in Pakistan without proper declaration and license attribution will be removed from the Play Store.”
The statement came days after the death by suicide of a 40-year-old man from Rawalpindi who was unable to return the loans he took from a number of mobile apps. His wife told media loan officers from the apps started threatening him on a daily basis, compelling him to take his own life.
Under the new set of rules, a lending app is prohibited from accessing sensitive data, such as external storage, media images, contacts, and fine location, whereas, mobile-based lenders offering short-term personal loans and requiring full repayment within 60 days, are not allowed.
Google said Pakistan was one of a small group of countries where it had implemented additional requirements for such lenders and the new policy update was a significant step toward safeguarding consumers from harmful financial practices and ensuring data privacy.
“Google is taking preventative measures by setting stringent requirements for Digital Lending Apps in order to reduce financial risk and ensure data privacy,” said Farhan S. Qureshi, Google’s Pakistan director.
“We strongly believe that the new requirements imposed on developers of personal loan apps will provide an extra layer of protection for the users.”
Pakistan’s IT minister said on Monday the country’s telecommunication regulator had blocked 43 rogue loan applications involved in extorting money from people, amid a crackdown against illegal mobile-based lenders.
The developments come at a time when Pakistan is faced with record double-digit inflation. Most people in the South Asian country are struggling to cope with a surge in living costs triggered by the devaluing currency and removal of subsidies by the government to stave off an economic collapse.
Fraudsters have found fertile ground for scams as more people turn to these mobile-based lenders. Many of the apps do not include contact details, making it impossible for aggrieved customers to seek redress.
