The Hindu Editorial • April 16, 2026 • Read Original

Devious menace: On predatory loan apps

Loan apps function in a regulatory dark area and promise easy credit

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The Hindu Read Original

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Analysis of editorial from The Hindu newspaper on April 16, 2026

Devious menace: On predatory loan apps

Loan apps function in a regulatory dark area and promise easy credit

Predatory Loan AppsRBI GuidelinesDigital LendingKeralaNithin Raj CaseFinancial Literacy

Sentences

Sentence 1 of 16

English Original

In the case of Nithin Raj, the first-year dental student in Kannur who died last week after falling from atop a five-storey building, the police have identified harassment over a loan that he secured via an app as a contributing factor.

Sentence Breakdown

Part 1

In the case of Nithin Raj, the in Kannur who died last week after falling from a five-storey building

The situation involving Nithin Raj, a student who studied dentistry in Kannur and passed away recently.

Part 2

the police

The government department responsible for maintaining law and order.

Part 3

have identified

Recognized or found out something through investigation.

Part 4

over a loan that he via an app

The bullying or pressure he faced because of a small amount of money he borrowed using a mobile application.

Part 5

as a

One of the reasons that led to the final outcome (his death).

Context and Background

The Nithin Raj Case

Nithin Raj, a 20-year-old student, allegedly took his own life due to extreme mental pressure from recovery agents of an illegal lending app. His death sparked protests and brought focus back to how these apps operate outside legal boundaries.

Sentence 2 of 16

English Original

His death is the third high-profile suicide linked to loan apps in Kerala within four months.

Sentence Breakdown

Part 1

His death

The passing away of the student (Nithin Raj).

Part 2

Represents a state of being or fact.

Part 3

the third suicide loan apps in Kerala within four months

The latest of three major cases where people took their own lives due to mobile loan app issues in Kerala lately.

Sentence 3 of 16

English Original

Since January, over 35 complaints related to these apps have been registered in Thiruvananthapuram Rural alone.

Sentence Breakdown

Part 1

Since January

Starting from the first month of this year until now.

Part 2

over 35 related to these apps

More than thirty-five formal reports made by victims about these loan applications.

Part 3

have been registered

Have been officially recorded by the authorities (police).

Part 4

in Thiruvananthapuram alone

Only within the specific outskirts or rural areas of Thiruvananthapuram district.

Sentence 4 of 16

English Original

In Raj’s case, parallel investigations are also probing allegations of caste-based discrimination at his college and the National Commission for Scheduled Castes has sought a report from the State police in under a week.

Sentence Breakdown

Part 1

In Raj’s case

In the specific situation involving Nithin Raj.

Part 2

investigations

Multiple investigations happening at the same time into different aspects of the same event.

Part 3

are also

Are investigating or looking deeply into something.

Part 4

of caste-based at his college

Claims that people were treated unfairly based on their caste in his educational institution.

Part 5

and the National Commission for Scheduled Castes

The government body that protects the rights of Scheduled Castes in India.

Part 6

has sought

Has asked for or requested something officially.

Part 7

a report from the State police

An official document explaining the details and findings of the police investigation.

Part 8

in under a week

With a deadline of less than seven days.

Context and Background

National Commission for Scheduled Castes (NCSC)

The NCSC is a constitutional body established under Article 338 of the Constitution of India. It has the power to investigate and monitor all matters relating to the safeguards provided for the Scheduled Castes under the Constitution or any other law.

Sentence 5 of 16

English Original

Once installed, these apps extract contact lists, photo galleries, and GPS data from the user’s device and export them to servers often located in North India or overseas.

Sentence Breakdown

Part 1

Once installed

After the application has been put onto the user’s phone.

Part 2

these apps

The predatory loan applications being discussed.

Part 3

Take out or remove data from the device without clear permission or for wrong reasons.

Part 4

contact lists, photo galleries, and GPS data

Personal information like phone numbers of friends, private pictures, and the location of the user.

Part 5

from the user’s device

From the smartphone or tablet belonging to the person using the app.

Part 6

and

And send the stolen information to another place.

Part 7

them

Refers to the contacts, photos, and location data mentioned earlier.

Part 8

to servers often located in North India or

To computers that store data, which are usually in far-off places or different countries.

Context and Background

App Permissions and Privacy

Predatory apps often trick users into granting broad permissions (contacts, storage, location). Once they have this data, they use it to blackmail borrowers by threatening to share their private details with their contacts.

Sentence 6 of 16

English Original

If repayment is delayed, recovery agents steadily ramp up harassment, including repeated abusive calls to the borrower, harassing persons listed as references on the loan application, and inflicting reputational damage.

Sentence Breakdown

Part 1

If is delayed

If the borrower does not pay back the money on time.

Part 2

recovery agents

People hired by the lender to collect unpaid debts from borrowers.

Part 3

steadily

Slowly but surely increase the pressure or intensity of their actions.

Part 4

harassment, including repeated calls to the borrower, harassing persons listed as on the loan application, and

A series of bad actions like making rude calls, bothering the borrower’s friends/family, and shaming the borrower in public.

Sentence 7 of 16

English Original

Kerala in particular has high smartphone penetration and digital literacy, but not necessarily financial literacy, and a large student population with urgent small-credit needs.

Sentence Breakdown

Part 1

Kerala in particular

Specifically the state of Kerala in India.

Part 2

has

Possesses certain qualities or features.

Part 3

high smartphone and

A situation where most people use smartphones and know how to use the internet and apps.

Part 4

but not necessarily

However, people might not know much about managing money, interest rates, or identifying illegal financial schemes.

Part 5

and a large student population with urgent needs

Many students who frequently and quickly need to borrow small amounts of money for their needs.

Sentence 8 of 16

English Original

Despite the RBI’s Digital Lending Guidelines, predatory apps lend without regulated status, fabricate Non-Banking Financial Company (NBFC) partnerships, route funds through opaque gateways, conceal fees and disbursal deductions, and provide no grievance mechanism.

Sentence Breakdown

Part 1

Despite the RBI’s Digital Lending Guidelines

Even though the Reserve Bank of India has set rules to control online lending.

Part 2

predatory apps

Dishonest mobile applications that trick people into taking loans with bad terms.

Part 3

lend

Give money to people with the expectation that they will pay it back with interest.

Part 4

without

Without having the official permission or license from the government to do business.

Part 5

Non-Banking Financial Company () partnerships

Pretend that they are working with real financial companies to look trustworthy.

Part 6

funds through gateways

Move money using payment systems that are difficult for the government to track.

Part 7

fees and

Hide the extra charges and the money they take out before giving the loan to the user.

Part 8

and provide no

And do not have any system for customers to report problems or complain.

Context and Background

RBI Digital Lending Framework

Introduced in 2022, the RBI’s Digital Lending Guidelines mandate that all loans must be disbursed and repaid directly between the borrower’s bank account and the Regulated Entity (Bank/NBFC). It also requires lenders to provide a Key Fact Statement (KFS) detailing all costs.

Sentence 9 of 16

English Original

The apps are able to operate because while the RBI regulates financial entities, the harmful entity operates in the app and data layers.

Sentence Breakdown

Part 1

The apps

The loan applications on the mobile phones.

Part 2

are able to operate

Can perform their business or carry out their activities.

Part 3

because

For the reason that.

Part 4

while the RBI

Even though the central bank controls banks and other official money companies.

Part 5

the harmful

The dangerous or illegal part of the group running the app.

Part 6

operates

Works or functions in a particular way.

Part 7

in the app and data

Within the technical parts of the software and the information it collects, which are not usually checked by money laws.

Sentence 10 of 16

English Original

As a first step, smartphone makers must consider an OS-level sandbox in which any app categorised as “financial” is technically barred from accessing contacts, photos, etc., even if the user grants permission.

Sentence Breakdown

Part 1

As a first step

To begin with the solutions.

Part 2

smartphone makers

Companies like Apple, Samsung, or Google that design and build mobile phones.

Part 3

must consider

Should think deeply about implementing a particular idea.

Part 4

an in which any app categorised as “financial” is technically from accessing contacts, photos, etc., even if the user grants permission

A security system in the phone’s software that stops money-related apps from seeing your private info, even if you accidentally say ‘yes’ to a permission request.

Context and Background

Sandboxing and App Privacy

Sandboxing is a security technique that isolates an application to prevent it from accessing resources elsewhere on the device. OS-level sandboxing would mean the phone’s software itself blocks predatory apps from stealing sensitive data, overriding any permission given by the user.

Sentence 11 of 16

English Original

The apps’ call centres are also often traced to other States or countries, beyond the reach of local police.

Sentence Breakdown

Part 1

The apps’

The offices where people work to call borrowers for debt collection.

Part 2

are also often

Are frequently discovered or followed back to their original location.

Part 3

to other States or countries

In different parts of India or even in foreign nations.

Part 4

beyond the of

In places where the nearby police do not have the legal power (jurisdiction) to take action.

Sentence 12 of 16

English Original

Second, India needs to enact legislation with prison sentences and heavy fines for illegal digital lending.

Sentence Breakdown

Part 1

Second

The second point or solution being suggested.

Part 2

India

The nation as a whole, specifically its governing bodies.

Part 3

needs

Requires or finds it necessary to do something.

Part 4

to with and heavy fines for illegal digital lending

To make a new law that punishes illegal online money lending with time in jail and large payments of money as a penalty.

Sentence 13 of 16

English Original

When an app is removed from a store or directory, its developers relaunch immediately under new names.

Sentence Breakdown

Part 1

When an app is removed from a store or

Every time an illegal application is taken down from places like Google Play Store.

Part 2

its developers

The technical people who created and manage the mobile application.

Part 3

relaunch

Start or introduce the application again after a failure or removal.

Part 4

immediately under new names

Right away, but using a different title to trick the system again.

Sentence 14 of 16

English Original

Third, the government can mandate all financial apps to have a cryptographically signed certificate of association from a regulated bank or NBFC and app stores to check listings against a Reserve Bank of India whitelist.

Sentence Breakdown

Part 1

Third

The third solution or point in the argument.

Part 2

the government

The central authority of the country.

Part 3

can

Can make something an official requirement by law.

Part 4

all financial apps to have a from a regulated bank or NBFC

Every money-related app must show proof (a special digital code) that they are officially connected to a real, licensed bank.

Part 5

and app stores to check listings against a Reserve Bank of India

And platforms like the Play Store must only allow apps that are on RBI’s list of safe and legal services.

Sentence 15 of 16

English Original

This is also why the Kerala government is mulling new legislation to regulate digital lending platforms and empower local police to act against apps operating from outside the State.

Sentence Breakdown

Part 1

This is also why

For this reason (the difficulties mentioned before).

Part 2

the Kerala government

The state-level governing authority in Kerala.

Part 3

Is thinking carefully about a plan or idea.

Part 4

new legislation to regulate digital lending platforms and local police to act against apps operating from outside the State

A new set of laws to control online loan apps and give more power to the police to stop illegal apps even if they are in other states.

Sentence 16 of 16

English Original

Fourth, the country needs rigorous disclosure standards on effective interest rates and fees, strict rules on recovery conduct, stricter KYC (Know your Customer) obligations on payment aggregators, and risk flags on UPI IDs associated with lending operations associated with a high complaint rate.

Sentence Breakdown

Part 1

Fourth

The fourth recommendation or step being proposed.

Part 2

the country

The entire nation (India).

Part 3

needs

Requires or finds something necessary to solve a problem.

Part 4

on effective interest rates and fees, strict rules on recovery conduct, stricter KYC (Know your Customer) on , and on UPI IDs associated with lending operations associated with a high complaint rate

Very strict rules about showing all costs clearly, how agents behave, checking the identity of users surely, and marking dangerous digital payment IDs.

Sentence 1 of 16

Sentences Breakdown

Editorial Summary

5-Point Summary

1 The suicide of Nithin Raj, a dental student in Kerala, has been linked to harassment by predatory online loan apps.
2 Predatory loan apps exploit users by extracting sensitive personal data like contacts and photos for intimidation.
3 Kerala’s high smartphone penetration makes its population vulnerable to these apps despite a lack of financial literacy.
4 Illegal apps often bypass RBI regulations by fabricating NBFC partnerships and using opaque payment gateways to route funds.
5 Addressing this menace requires OS-level sandboxing, stricter legislation, and rigorous disclosure standards for digital lending platforms.

Tone of the Editorial

Critical

Why this tone?

The editorial takes a strong stance against the “devious menace” of predatory loan apps. By using words like “harassment”, “predatory”, “opaque”, and “devious”, it emphasizes the harmful nature of these platforms and calls for urgent, multi-level regulatory action to protect vulnerable citizens.

Sentence 1 of 16

Sentence Breakdown

Part 1

In the case of Nithin Raj, the first-year dental student in Kannur who died last week after falling from atop a five-storey building

The situation involving Nithin Raj, a student who studied dentistry in Kannur and passed away recently.

Part 2

the police

The government department responsible for maintaining law and order.

Part 3

have identified

Recognized or found out something through investigation.

Part 4

harassment over a loan that he secured via an app

The bullying or pressure he faced because of a small amount of money he borrowed using a mobile application.

Part 5

as a contributing factor

One of the reasons that led to the final outcome (his death).

Sentence 2 of 16

His death is the third high-profile suicide linked to loan apps in Kerala within four months.

Sentence Breakdown

Part 1

His death

The passing away of the student (Nithin Raj).

Part 2

Represents a state of being or fact.

Part 3

the third high-profile suicide linked to loan apps in Kerala within four months

The latest of three major cases where people took their own lives due to mobile loan app issues in Kerala lately.

Sentence 3 of 16

Since January, over 35 complaints related to these apps have been registered in Thiruvananthapuram Rural alone.

Sentence Breakdown

Part 1

Since January

Starting from the first month of this year until now.

Part 2

over 35 complaints related to these apps

More than thirty-five formal reports made by victims about these loan applications.

Part 3

have been registered

Have been officially recorded by the authorities (police).

Part 4

in Thiruvananthapuram Rural alone

Only within the specific outskirts or rural areas of Thiruvananthapuram district.

Sentence 4 of 16

Sentence Breakdown

Part 1

In Raj’s case

In the specific situation involving Nithin Raj.

Part 2

parallel investigations

Multiple investigations happening at the same time into different aspects of the same event.

Part 3

are also probing

Are investigating or looking deeply into something.

Part 4

allegations of caste-based discrimination at his college

Claims that people were treated unfairly based on their caste in his educational institution.

Part 5

and the National Commission for Scheduled Castes

The government body that protects the rights of Scheduled Castes in India.

Part 6

has sought

Has asked for or requested something officially.

Part 7

a report from the State police

An official document explaining the details and findings of the police investigation.

Part 8

in under a week

With a deadline of less than seven days.

Sentence 5 of 16

Once installed, these apps extract contact lists, photo galleries, and GPS data from the user’s device and export them to servers often located in North India or overseas.

Sentence Breakdown

Part 1

Once installed

After the application has been put onto the user’s phone.

Part 2

these apps

The predatory loan applications being discussed.

Part 3

extract

Take out or remove data from the device without clear permission or for wrong reasons.

Part 4

contact lists, photo galleries, and GPS data

Personal information like phone numbers of friends, private pictures, and the location of the user.

Part 5

from the user’s device

From the smartphone or tablet belonging to the person using the app.

Part 6

and export

And send the stolen information to another place.

Part 7

them

Refers to the contacts, photos, and location data mentioned earlier.

Part 8

to servers often located in North India or overseas

To computers that store data, which are usually in far-off places or different countries.

Sentence 6 of 16

Sentence Breakdown

Part 1

If repayment is delayed

If the borrower does not pay back the money on time.

Part 2

recovery agents

People hired by the lender to collect unpaid debts from borrowers.

Part 3

steadily ramp up

Slowly but surely increase the pressure or intensity of their actions.

Part 4

harassment, including repeated abusive calls to the borrower, harassing persons listed as references on the loan application, and inflicting reputational damage

A series of bad actions like making rude calls, bothering the borrower’s friends/family, and shaming the borrower in public.

Sentence 7 of 16

Kerala in particular has high smartphone penetration and digital literacy, but not necessarily financial literacy, and a large student population with urgent small-credit needs.

Sentence Breakdown

Part 1

Kerala in particular

Specifically the state of Kerala in India.

Part 2

has

Possesses certain qualities or features.

Part 3

high smartphone penetration and digital literacy

A situation where most people use smartphones and know how to use the internet and apps.

Part 4

but not necessarily financial literacy

However, people might not know much about managing money, interest rates, or identifying illegal financial schemes.

Part 5

and a large student population with urgent small-credit needs

Many students who frequently and quickly need to borrow small amounts of money for their needs.

Sentence 8 of 16

Sentence Breakdown

Part 1

Despite the RBI’s Digital Lending Guidelines

Even though the Reserve Bank of India has set rules to control online lending.

Part 2

predatory apps

Dishonest mobile applications that trick people into taking loans with bad terms.

Part 3

lend

Give money to people with the expectation that they will pay it back with interest.

Part 4

without regulated status

Without having the official permission or license from the government to do business.

Part 5

fabricate Non-Banking Financial Company (NBFC) partnerships

Pretend that they are working with real financial companies to look trustworthy.

Part 6

route funds through opaque gateways

Move money using payment systems that are difficult for the government to track.

Part 7

conceal fees and disbursal deductions

Hide the extra charges and the money they take out before giving the loan to the user.

Part 8

and provide no grievance mechanism

And do not have any system for customers to report problems or complain.

Sentence 9 of 16

The apps are able to operate because while the RBI regulates financial entities, the harmful entity operates in the app and data layers.

Sentence Breakdown

Part 1

The apps

The loan applications on the mobile phones.

Part 2

are able to operate

Can perform their business or carry out their activities.

Part 3

because

For the reason that.

Part 4

while the RBI regulates financial entities

Even though the central bank controls banks and other official money companies.

Part 5

the harmful entity

The dangerous or illegal part of the group running the app.

Part 6

operates

Works or functions in a particular way.

Part 7

in the app and data layers

Within the technical parts of the software and the information it collects, which are not usually checked by money laws.

Sentence 10 of 16

Sentence Breakdown

Part 1

As a first step

To begin with the solutions.

Part 2

smartphone makers

Companies like Apple, Samsung, or Google that design and build mobile phones.

Part 3

must consider

Should think deeply about implementing a particular idea.

Part 4

an OS-level sandbox in which any app categorised as “financial” is technically barred from accessing contacts, photos, etc., even if the user grants permission

A security system in the phone’s software that stops money-related apps from seeing your private info, even if you accidentally say ‘yes’ to a permission request.

Sentence 11 of 16

The apps’ call centres are also often traced to other States or countries, beyond the reach of local police.

Sentence Breakdown

Part 1

The apps’ call centres

The offices where people work to call borrowers for debt collection.

Part 2

are also often traced

Are frequently discovered or followed back to their original location.

Part 3

to other States or countries

In different parts of India or even in foreign nations.

Part 4

beyond the reach of local police

In places where the nearby police do not have the legal power (jurisdiction) to take action.

Sentence 12 of 16

Second, India needs to enact legislation with prison sentences and heavy fines for illegal digital lending.

Sentence Breakdown

Part 1

Second

The second point or solution being suggested.

Part 2

India

The nation as a whole, specifically its governing bodies.

Part 3

needs

Requires or finds it necessary to do something.

Part 4

to enact legislation with prison sentences and heavy fines for illegal digital lending

To make a new law that punishes illegal online money lending with time in jail and large payments of money as a penalty.

Sentence 13 of 16

When an app is removed from a store or directory, its developers relaunch immediately under new names.

Sentence Breakdown

Part 1

When an app is removed from a store or directory

Every time an illegal application is taken down from places like Google Play Store.

Part 2

its developers

The technical people who created and manage the mobile application.

Part 3

relaunch

Start or introduce the application again after a failure or removal.

Part 4

immediately under new names

Right away, but using a different title to trick the system again.

Sentence 14 of 16

Sentence Breakdown

Part 1

Third

The third solution or point in the argument.

Part 2

the government

The central authority of the country.

Part 3

can mandate

Can make something an official requirement by law.

Part 4

all financial apps to have a cryptographically signed certificate of association from a regulated bank or NBFC

Every money-related app must show proof (a special digital code) that they are officially connected to a real, licensed bank.

Part 5

and app stores to check listings against a Reserve Bank of India whitelist

And platforms like the Play Store must only allow apps that are on RBI’s list of safe and legal services.

Sentence 15 of 16

This is also why the Kerala government is mulling new legislation to regulate digital lending platforms and empower local police to act against apps operating from outside the State.

Sentence Breakdown

Part 1

This is also why

For this reason (the difficulties mentioned before).

Part 2

the Kerala government

The state-level governing authority in Kerala.

Part 3

is mulling

Is thinking carefully about a plan or idea.

Part 4

new legislation to regulate digital lending platforms and empower local police to act against apps operating from outside the State

A new set of laws to control online loan apps and give more power to the police to stop illegal apps even if they are in other states.

Sentence 16 of 16

Sentence Breakdown

Part 1

Fourth

The fourth recommendation or step being proposed.

Part 2

the country

The entire nation (India).

Part 3

needs

Requires or finds something necessary to solve a problem.

Part 4

rigorous disclosure standards on effective interest rates and fees, strict rules on recovery conduct, stricter KYC (Know your Customer) obligations on payment aggregators, and risk flags on UPI IDs associated with lending operations associated with a high complaint rate

Very strict rules about showing all costs clearly, how agents behave, checking the identity of users surely, and marking dangerous digital payment IDs.

Reading Comprehension

Practice questions based on this editorial

Reading Comprehension - Predatory Loan Apps

Practice reading comprehension questions based on the editorial about the threat of predatory loan apps and required regulatory measures.

5 Questions Passing: 70%

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