Google has recently announced a new policy aimed at preventing financial lending apps from accessing users' photos, videos, and contacts in an effort to combat predatory behavior from some lenders. This new policy is designed to prevent loan apps from harassing and intimidating borrowers into paying off their outstanding debts.
The policy is set to take effect on May 31 and will be implemented in markets that have been most affected by debt harassment, including Pakistan, Kenya, India, Indonesia, Nigeria, and the Philippines. These are countries where individuals who have received loans from mobile credit apps have been targeted with harassment after failing to repay their loans.
By accessing the personal contacts and images of borrowers, debt collectors have been sending manipulated photos to friends and family members of the debtors. In some cases, these targeted individuals have even taken their own lives after the harassment.
To address this issue, Google has responded by blocking hundreds and then thousands of personal loan apps from its Play Store after being alerted by law enforcement agencies and central banks. The company has also introduced rules to ban unlicensed loan apps from the Android app store.
The new policy states that financial lending apps may not access users' contacts or photos. It also requires that apps promoting financial products and services must comply with regional and local regulations for any region or country that they target.
In Nigeria, loan apps must adhere to a limited interim regulatory/registration framework and guidelines for digital lending set by the Federal Competition and Consumer Protection Commission (FCCPC) and obtain a verifiable approval letter from the FCCPC. Loan aggregators must provide documentation and/or certification for digital lending services and contact details for every partnered digital money lender (DML).
Google will require app creators to provide additional information or documents relating to their compliance with the applicable regulatory and licensing requirements upon request.
This new policy is an important step towards protecting borrowers from predatory behavior by loan apps, and it is hoped that other tech companies will follow suit to protect vulnerable individuals from harassment and exploitation.
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