Hyderabad, India – Disturbing calls started soon after sunrise. Kiran Kumar stayed in bed and kept thinking for hours how he was going to end his life’s hostage.
The cement seller initially borrowed about $ 40 to supplement his $ 200-month salary through an online app. But he could not pay the rising fees and interest, so he borrowed from others. By that morning, Mr. Kumar was owed about $ 4,000.
Worse, lenders had phone numbers of people closest to them, threatening to make their problems public.
Mr. Kumar, 28, said in an interview, “If I am convicted of cheating in front of everyone, then my self-respect is gone, my honor is gone.” “What’s left?”
Officials in India are worried that many more victims, such as Mr. Kumar, may be out there. They believe that a new breed of lender, its technology has intensified in China, which favors working class and rural people. Devastated by the effects of coronavirus On the Indian economy.
These lenders do not require a credit score or visit to a bank. But they charge high costs in a short period. They require access to a borrower’s phone, contacts, photos, text messages, even siphons of up to a battery percentage.
They then threaten dire consequences for non-payment with pleas, threats and sometimes fake legal documents on borrowers and their social circles. In conservative, tightly knit communities, such loss of respect can be devastating.
A police investigation in the city of Hyderabad alone has mapped around 14 million transactions across the country in about six months worth $ 3 billion. India’s central bank as well as national authorities are now investigating.
Joint Commissioner of Police in Hyderabad Avinash Mohanty said, “It is becoming difficult for us to calculate zero.” Police handed over five suicides in the city to lenders.
About 100 loan apps According to the Government of India, Google has been removed from the platform. A Google spokesperson said it reviewed hundreds of loan apps and removed those who violated its terms.
Investigations are rampant in India on the vulnerability of the 1.3 billion population who are still accustomed to digital payments. Online transactions in India will reach more than this $ 3 trillion By 2025, according to consulting firm PwC. Further fraudulent findings may motivate the government, which has Already limited Personal data that online companies can use to create a tight grip on the industry.
The apps also speak to the global nature of online fraud. Many companies use the technologies that were flourishing in China two years ago, before the authorities closed them, and since then Reappear somewhere.
The loan application emerged in a desperate time. The government enforced a strict, two-month lockdown a year ago, covering India as a deep recession. Millions of people were fired. Traditional forms of lending such as banks and microlender were temporarily closed.
With names like Money Now, First Cash, Super Cash and Cool Cash – according to police documents – apps have come and gone on Google’s App Store in India, with some reappearing with a slight change of identity. Most were built with off-the-shelf software that made their creation as easy as starting a blog, said Srikanth Lakshmanan, one of the cashless consumers’ coordinators, a group of technology volunteers who study the app Has been doing.
With a few taps on a phone and a fresh selfie, a borrower can get the cash needed for a doctor’s appointment, to rest in the kitchen or to pay the child’s school fees.
Repayment can be done as soon as possible in a week. Lenders often added interest and fees, as they took one-third of the loan even before sending the money, so borrowers would have to pay more than they had already received. And to get the money, the borrowers had to hand over their personal information.
That was when, according to police and analysts, the call centers were in action. At first they would consider it bad to pay back the principal, interest and fees to the borrowers. They would then call friends and family, sometimes saying that the borrower was wanted by the police. Some formed WhatsApp groups, added members to the borrower’s contact list, then bombed the group with accusations. Some would incite borrowers to other services, who lent the money, pushing them forward.
Police in Hyderabad took notice after committing suicide this past winter and after people filed complaints of harassment. They were stunned until an informant surfaced and, in exchange for a reward of about $ 150, shared the address and details of a call center where a close friend worked as a collection agent.
In an interview with The New York Times, the collection agent – a fast-talking 24-year-old who made about $ 130 a month – said that each day he would receive electronic files on about 50 borrowers. The files include his personal details, copies of his government ID and his contact list.
The collection agent said that workers could pay a weekly bonus of about $ 7 to ask for benami property from their former employer for fear of retaliation. The bonus doubled to a success rate of four-fifths or more. Customers are often begging for time, the agent said, and some even said that constant harassment would lead to his death. The collection agent, Eyes on Bonus, will continue anyway.
So far, investigations in Hyderabad have raided call centers in at least four Indian cities, each employing between 100 and 600 centers.
Some companies have connections to China. Police said that at least four Chinese citizens have been arrested so far. In reverse-engineering the most absorbent apps, activists like Mr. Lakshmanan found that a large number of Chinese cloud services were hosted and used Chinese software development kits and facial recognition tools.
Police have bank accounts of about $ 40 million so far. But the trail often leads to networks used for shell companies, money laundering or cryptocurrency, which are difficult for governments to track.
Nevertheless, publicity in Hyderabad has triggered a public backlash.
Mr. Kumar, the cement seller, is now part of an online advocacy group. Around 60 victims have joined its WhatsApp channel, where they respond to harassing calls that continue or provide support.
Mr. Kumar was the last call to a friend when he lay in bed in the morning last summer and thought of ending his life. The friend recognized the urgency, ran into the room and helped collect $ 400 within hours Mr. Kumar had to pay that day to reduce some of the harassment.
“If it wasn’t for my friend, I was 90 percent sure that I would commit suicide that day,” Mr. Kumar said. “I still get calls. But now I tell them, ‘Do whatever you can.’ I am not worried anymore. I feel safe “
But for some families, neither pain nor persecution has gone away.
The 38-year-old father-of-three, who works in a clothes warehouse. Chandra-Mohan took a loan of about $ 1,000. After interest, fees and fines, borrowing to remain separate from other services was five times its balance. With a salary of $ 200 a month, and $ 80 per month that his wife, Sarita, was made from a part-time job in a lab, she could not pay him back.
Mr. Chandra-Mohan maximized his credit card and drew from dozens of loan apps, his family said. When he complained of harassing the police, they asked him to turn off his phone for a few days and if it kept going, his father-in-law M. Said Selu. Police said it may have called a cybercrime hotline, but they did not have a record of going to the police station.
One morning, when Mr. Chandra-Mohan took his wife to his office on the back of his motorcycle, he gave some change to his three young daughters and sent them around the corner to their grandparents’ house. Then, he hung himself from the fan.
“Even after his suicide,” his wife said, “the phone keeps ringing.”
If you are considering suicide, call the National Suicide Prevention Lifeline in the United States at 1-800-273-8255 (TALK). In India, contact 91-9820466726 or visit the website website Aasra.info For more resources.
Cao Li Contributed to reporting from Hong Kong.