Govt blocks 87 illegal loan lending applications under IT Act

Minister of State for Corporate Affairs Harsh Malhotra said on Monday that the IT Ministry (MeitY) has blocked 87 illegal lending apps so far.

In a written reply in the Lok Sabha, he said the action was taken under Section 69A of the Information Technology Act, 2000.

“… So far, after following the due process, MeitYhas blocked a total of 87 illegal loan lending applications under section 69A of the Information Technology Act 2000,” said Malhotra. 

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Replying to a question from Samajwadi Party MP Lalji Verma, the minister added that inquiries, inspections, and investigations are carried out “from time to time” under the Companies Act against companies involved in online lending. He said that whenever violations are found, the government takes appropriate legal action against those firms.

In his written reply, he also said that the government regularly orders inquiries, inspections of books of accounts, and investigations under the Companies Act, 2013, including for companies involved in online lending through loan apps. He added that “whenever any violation under the Companies Act, 2013 is found, appropriate legal action is taken.”

This comes soon after the Corporate Affairs Ministry launched investigations last year into 665 illegal Chinese lending apps, following complaints from the RBI and MeitY. Some of these cases were also referred to the Serious Fraud Investigation Office.

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At the time, the ministry was looking into cancelling registrations and freezing the bank accounts of these fraudulent operators.

The crackdown was part of the Centre’s wider effort to stop illegal Chinese loan apps in India. In many cases, these apps—run by Chinese nationals—were allegedly using forged KYC documents of unsuspecting Indians and making them dummy directors of shell companies.

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