Payday loan fraud risks – what you should do to keep your business scam free

Payday loans favour people with short term financial need and financial emergencies. They have saved many people form debts, late payments, accident bills and other risky financial situations. They are also fast and easy to acquire. When you won a payday loan website, you want to ensure your consumers get the best type of treatment. The online platform has led to the development of online banking as well as increase in the number if scammers. In order to keep your customers safe, there are several precautions you should take;

Follow all the state regulations

As a payday loan dealer, there are certain legal government regulations you are required to follow. They include interest rate and loan limit regulations. For instance, there is a certain amount in loan limits you are supposed to give to a consumer. You should not charge a higher interest rate than you are legally required to. If you break these two rules, your actions are considered as money fraud and you will suffer many consequences.

Lenders asking for an upfront fee

Fraudulent lenders will ask customers for an upfront fee before they offer them any services. These people create fake websites and pose as payday loan lender so they can con individuals out of their money. This usually happens to most people who try to register online accounts.  The lender will promise people to lower interest rates and higher payouts they you make an upfront fee first.  When they do, they escape with their money leaving them with no contacts or physical locations. If you are a legitimate payday loan lender, you should never ask your customers for a fee before you provide them with any type of services.

Federal regulations

Federal truth regulations in lending acts require lenders to disclose all information concerning the total cost of the loan to the lenders. Some lender will impose hidden fees on their policies to trap unsuspecting customers. Since they already signed an agreement, there is nothing much they can do about it legally. Imposing a hidden fee is a form of scam which should not befall your clients.

Asking for too much information

As a lender, you should ask for valuable information and refrain from asking too much personal questions about the customer. When online hackers get access to this information, they can use it to steal their identity, sell the identity or subscribe your customer to paid services that they do not need. This can be devastating for people who are living with tight finances. Ensure you secure you online website and post your contact and physical address.

When you set up an online website, you should have the security certificates to verify your legitimate business. Securing the website will keep the information away from all the online scammers and fraudsters. The certificate will help customers identify your real website from all the fake online counterfeits. It will make it easier to trust you and sign up an account with you.

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