Android apps offering personal loan services will not be able to access users’ sensitive data, such as photos and contacts, with the new restrictions imposed by Google
Changes to Google’s Loan Policy to come into effect on May 31, 2023 will prohibit Google Play apps providing personal loans to access the handset’s external storage, photos and videos, contacts, precise location and call logs.
Additional requirements will be introduced for personal loan apps targeting users in Pakistan. These app developers will be obliged to submit country-specific licensing documentation to prove their ability to provide or facilitate personal loans nationwide. Besides, the company mandated non-banking financial companies in the country to have only a single digital lending app on the Play Store.
The move was reportedly made in response to the spreading predatory practices when debt collectors are using sensitive information of individuals, e.g. personal contacts to harass borrowers. In more extreme cases registered, collecting agents have even employed manipulated images to intimidate and distress the debtors.
In Kenya, Google removed hundreds of loan apps from the Play Store altogether. In India, the situation was even worse, as more than 2000 apps had to be taken down upon alerts received from law enforcement agencies and central banks.
The new rule applies not only to the apps that provide personal loans per se, but also those which facilitate access to personal loans and connect consumers with third-party lenders (i.e., lead generators or facilitators). Personal loans category also includes payday loans, peer-to-peer loans, title loans, etc.
Apps that provide and facilitate personal loans must have the App Category set to “Finance” in Play Console and disclose the following information in the app metadata:
- Minimum and maximum repayment periods;
- Maximum APR;
- A representative example of the total cost of the loan, including both the principal and all applicable extra fees;
Apps that promote short-term personal loans which require full repayment in 60 days or less are not allowed on Play Store.