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Glossary

Loan Fraud (Advance Fee Scam)

A scam where fake agents demand an upfront fee, insurance or deposit for a loan that never comes.

What it means

Fraudsters posing as bank agents or loan apps promise guaranteed approval regardless of credit score, then ask for a processing fee, GST, insurance premium or security deposit before disbursal, often via UPI. The loan never arrives and the money is gone.

Regulated lenders and their genuine agents never collect fees before sanction, never guarantee approval and never ask for payment to a personal account. Verify the lender on the RBI website, insist on a Key Fact Statement, and report fraud to the cybercrime helpline 1930.

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