CAA sounds alarm on online loan fraud

Fraudulent online loan schemes promising instant cash with no documents or guarantors are targeting the public, the Consumer Affairs Authority warned.

Advertisements offering instant loans within five minutes would place consumer money, privacy, and personal safety at risk, the authority emphasised.

Several risks are linked to these online loan scams. Borrowers often fail to receive the full requested amount because of hidden charges, whilst facing excessive and unfair interest rates.

These applications gain unauthorised access to personal data stored on mobile devices, leading to threats, harassment, and blackmail over delayed repayments.

Consumers should obtain loans only from financial institutions approved by the Central Bank of Sri Lanka and avoid installing unknown loan applications, the authority advised.

Victims of such scams should immediately lodge complaints with the police or the Cyber Crime Investigation Division, the statement further noted.