Tangentially related to part of the text in the article : A lot of these and other apps ask you to share documents, camera, mic, gps, and other access from your phone . The problem is that several of those wont work if you reject that access. Even worse, Mexican government passed a law that made it compulsory to monitor your GPS position for Banks and other money related companies, so doing relatively common bank transactions require you to lose your privacy.<p>Given these blatant privacy violations, I wish mobiles had the option to "mock" data for those sensors. Share files? Sure, give access to a jail like bkank file system. Share mic? Sure, give access to a white noise generated stream, same with video/camera. Share gps? Give some mock location, etc.<p>That's what a privacy enabled device would do.<p>I wonder why hasn't this even been implemented at the browser level.
These scams are going on in India too. Typically they offer $100-$200 loans, and there is no legal framework. Victims are afraid to go to the police. Even if someone goes to the police, these apps are all running from China, and they can't do much about it. From the BBC article: "The people running the apps gained access to all the contacts on his phone and his pictures, and have threated to send nude pictures of his wife to everyone on his phone."[1] It is a horrible system, and Google doesn't care about poor people getting scammed. Some victims even committed suicide because of the threat of releasing their private data.<p>[1]<a href="https://www.bbc.com/news/business-61564038" rel="nofollow">https://www.bbc.com/news/business-61564038</a>
It references this story which to me is very troubling:<p><pre><code> Contreras told the story of one woman who fell victim
to these schemes named Maria. After Maria took a loan,
agents for the app iFectivo sent her 13-year-old daughter,
her cousin, her nieces, and more than a dozen of her other
contacts a picture of a nude woman with her face
photoshopped on. iFectivo told her contacts she had
become a prostitute to pay her debts.
</code></pre>
Full story (referenced in TechPolicy article): <a href="https://restofworld.org/2022/mexico-scam-loan-apps/" rel="nofollow">https://restofworld.org/2022/mexico-scam-loan-apps/</a><p>Troubling, unethical, illegal stuff.
As I understand it, the way these apps work is:<p>1. The loan interest rate is set relative to a base default rate of a population sample of lenders. Therefore very easy to predict capital return, but means interest rates are usually high to cover high rate of defaults.<p>2. Defaulting loans are sold to local debt collectors for collection, who presumably are quite ruthless.<p>3. There are a few companies which white label the software needed to run this sort of scheme, so presumably the operator only has to drop in capital.<p>If you have further information on how these businesses work, please respond!
><i>Last year, a Reuters investigation by Rina Chandran found dozens of lending apps in India that appeared to violate Google’s policies against short-term loans</i><p>just FYI - this is contrary to the product and the law of India. Google is not the regulator.<p>For example Manndeshi foundation runs 24 hour loans for women vegetable sellers - who take a loan in the morning and pay back at night.<p>Google Play "ethics" is US-centric. It does not take into account the realities of the local demographics. for example sub 90 day loans are illegal on Play - a lot of microfinance in India/Bangladesh is sub 90 days.<p>What ends up happening is demonisation of everyone not playing by Google Play's rules and gets termed as "predatory".
While there is plenty of room for doubt about micro-lending (see [1] which I hosted, by Hugh Sinclair, a guy who's actually been there in the field), I don't think it's fair to call these scams "micro-lending." Maybe they're taking advantage of the favorite PR that micro-loans get.<p>In the micro-lending plans that Oxfam and other legit charities back, borrowers meet in person with the lenders, and no hounding takes place. Most of them pay their loans back promptly.<p>However, the stories about "poor woman buys a sewing machine; lifts her family out of poverty" are mostly just feel-good PR to milk the donors. More often, they buy a stall in the market to sell produce, and there's only so many stalls the market can support.<p>The real scandal of micro-lending, as Hugh explains, is that the interest rates are scandalously high, and the lenders are mostly using it as a way to buy SUVs and milk the First World donors who want to feel good.<p>These scams are <i>not</i> "micro-lending."<p>[1] <a href="https://www.youtube.com/watch?v=rhdZ2RfmiXo" rel="nofollow">https://www.youtube.com/watch?v=rhdZ2RfmiXo</a>
It's a shame because I think there is a legitment use-case for micro-lending but there needs to be regulation and enforcement. Also asking for those kind of wide permissions should trigger some kind of additional review - a scam-filled untrusted ecosystem hurts all app developers.
I wonder if this has to happen in US so that people start treating privacy as a real issue and not tinfoil hat rant type complaint. Whenever I try to engage in this conversation, 'I have nothing to hide' is a very common refrain. At that point I typically ask for their phone to rummage through. Oddly, that is the moment they hesitate. It is not ok for me to have this information, but a faceless entity connected only by an app? No problem. I fear for the human race.
Be aware of other scams too, some women are sending nudes to people and screenshoting theirs in hopes of extorting.<p>Really have to just stay frosty all the time now.
This kind of scam was so rampant in Indonesia until the government took strong stance, effectively sweeping the practice across the country.
It's like Google doesn't even care about this things, in contrary they're so fast blocking and suspending app submissions that against their bottom line, like digital goods and payments methods.
Here's a question, are these shady apps necessarily worse than the village loan shark which is where the desperate turn to money otherwise? To some extent, the market for no-questions-asked risky loans is similar to gambling, drugs and prostitution, it's a perennial vice that's impossible to stamp out. Is formalizing it better than not formalizing it?
The whole microloan program has been hyped for over a decade now, but as this story shows, the outcome more often than not has been more like mafia loansharking than actual economic development under the entrepreneurial free-market model. This can be explained via the notion that "enterpreneurs without lawyers end up getting screwed over more often than not" and the people who get these microloans just can't afford to hire lawyers to protect themselves.<p>While it's a right-wing trope, the microloan program has been heavily promoted by the likes of the Soros-Omidyar crowd, with the typical humanitarian patina covering what's really just predatory capitalism:<p><i>"We have seen what microloans can do at the individual level and are excited about bringing that same opportunity to small and medium businesses," said Jim Bunch, Director of Investments at Omidyar Network.</i><p>Here's another expository write-up of the phenomenon, in Cambodia. Looks very similar to India, Mexico, etc.<p><a href="https://www.aljazeera.com/economy/2019/8/6/cambodias-micro-loans-a-form-of-predatory-lending" rel="nofollow">https://www.aljazeera.com/economy/2019/8/6/cambodias-micro-l...</a><p>[edit] for more on background on this global trend and its origins (2007)<p>> "Microcredit is the newest silver bullet for alleviating poverty. Wealthy philanthropists such as financier George Soros and eBay co-founder Pierre Omidyar are pledging hundreds of millions of dollars to the microcredit movement. Global commercial banks, such as Citigroup Inc. and Deutsche Bank AG, are establishing microfinance funds. Even people with just a few dollars to spare are going to microcredit Web sites and, with a click of the mouse, lending money to rice farmers in Ecuador and auto mechanics in Togo... Wealthy philanthropists, banks, and online donors aren’t the only ones fascinated with microcredit. The United Nations designated 2005 as the International Year of Microcredit..."<p><a href="https://ssir.org/articles/entry/microfinance_misses_its_mark" rel="nofollow">https://ssir.org/articles/entry/microfinance_misses_its_mark</a>
To be vulnerable to this kind of extortion, there has to be something about your life, true or false, that you'd prefer people not say about you.<p>I was thinking, and I don't think there is anything that I wouldn't want said to my friends or family.<p>Everything that could be said is either plainly untrue, or wouldn't sufficiently bother me to change my behaviour.<p>I wonder how other people get into positions where this isn't the case for them?