Fintech, a portmanteau of finance and technology, has revolutionised the lending and payment landscape in the past few years in India. The industry has witnessed phenomenal growth in terms of companies engaged in lending, which have made credit access easy to borrowers. Fraught with opportunities, these lending companies have equally attracted the attention of investors and fraudsters.
While digital lending has the potential of making access to financial products fair, efficient and far more inclusive than traditional banks, customers should be aware of the downside risks that are interwoven with such endeavours. A basic understanding of digital loans and the process of lending will help borrowers stay safe from frauds.
Here are some aspects that a lender should be aware of before relying on fintechs for loans: