Public warned to exercise caution when obtaining online, mobile loans

Colombo, Oct. 16 (Daily Mirror) - Police warned the public to exercise caution when obtaining loans via the Internet or mobile phones, following an increase in complaints related to deceptive lending practices.

Police said a significant number of institutions are currently advertising loans online and through mobile platforms, often attractively presenting these offers. In some cases, unsolicited phone calls are also used to promote the availability of instant loans without any collateral requirements.

They said reports received by the police reveal that many individuals are facing serious financial difficulties after obtaining such loans without paying due attention to the interest rates and repayment terms involved.

Daily complaints indicate that, in many cases, borrowers are unexpectedly required to pay extremely high interest rates and these institutions are allegedly engaging in unethical recovery practices such as repeatedly calling borrowers in a harassing manner and publishing defamatory content on social media platforms to shame those who fall behind on payments.

Police said they conducted a joint inquiry with the Non-Banking Financial Institutions Supervision Department of the Central Bank of Sri Lanka where the findings confirmed that many of the entities offering loans through digital platforms are not regulated by the Central Bank.

The Central Bank has stated that steps are being taken to bring such institutions under proper regulatory oversight.

In light of this situation, police urge the public to obtain financial services only from institutions that are duly regulated by the Central Bank of Sri Lanka to avoid potential exploitation and financial harm. 

For further information or to report any suspicious financial activities, members of the public are encouraged to contact their nearest police station or refer to the official website of the Central Bank of Sri Lanka.