India Blocks 87 Illegal Loan Apps Over Harassment, Fraud and Data Misuse

The Indian government has blocked 87 illegal loan apps following a surge in public complaints about harassment, fraud, and the misuse of personal data. The Ministry of Electronics and Information Technology (MeitY) invoked its powers under Section 69A of the Information Technology Act, 2000, to remove these non-compliant apps from public access. The decision was formally announced in the Lok Sabha by Minister of State for Corporate Affairs Harsh Malhotra, who highlighted growing concerns over predatory digital lending practices that often operate outside the Reserve Bank of India’s regulatory framework.

These banned platforms had become notorious for coercive loan recovery tactics, exorbitant interest rates, and unlawful access to users’ personal information. By blocking the apps, the government aims to immediately halt consumer interaction with these entities and curb the spread of unauthorised digital lending operations. The action aligns with rising public outcry and media reports detailing widespread exploitation by such illegal lenders.

Alongside the bans, Malhotra noted that the corporate affairs ministry is conducting ongoing inquiries, inspections and investigations under the Companies Act, 2013, against firms involved in unlawful online lending activities. Violations are met with legal action, forming part of a broader dual-pronged strategy: using the IT Act to restrict digital access and the Companies Act to penalise offending companies. The government says these measures are intended to make the fintech ecosystem safer, more transparent and fully compliant with consumer protection norms.

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