You’ve probably seen those payday loan businesses in strip malls across the United States. They’re small one or two room places with a desk and some crappy chairs and ridiculously gaudy signs. If you haven’t seen them, you have probably heard of their reputation as predatory lenders. They’ll give people a loan at an insanely high interest rate against the person’s next paycheck, and tend to lock people in a cycle of debt that is very hard to get out of. While these places are bad, they have nothing on what goes on in India on a regular basis.
Over in the Asian subcontinent, they handle this sort of thing digitally and there are too many different lending apps to keep track of. In essence, they operate on a similar model to the American payday loan companies. They offer small, short-term loans at a high interest rate against the next paycheck. The similarities end there though. While American companies charge an average of 20% interest, their Indian counterparts often charge an interest rate of 80% or more. They also charge their victims in another way – the lender demands access to all their data. So to get $40 at an 80% interest, you have to grant the lender’s app access to all the data on your phone.
So what happens if you can’t pay? Does the company cut their loss and consider the data as payment? No. Not even close. They actually start harassing their victims. Calling and texting over 1000 times a day in some cases. Some people make use of multiple lending apps, making the problem even worse.
I’ve used the term ‘victim’ twice now. That’s a pretty strong word and not to be thrown around lightly. Yet, it is perfectly appropriate here. With that kind of harassment, it is driving many to suicide, and straining every relationship the victim has as he struggles to figure out how to get out of this debt. They are also victims because often the terms of the app are in English which not everyone can read fluently, and even if they can, just like lenders here, the loan agent will do whatever he can to convince the victim that they can handle the loan without any problem, they have full confidence it will get paid back on time.
There have even been some companies that would hire professional harassers to stand outside of a victim’s home or business and scream at and berate them for hours on end. Small wonder that some would be driven to suicide and no doubt to crime in a desperate effort to make the yelling and the phone calls stop.
To add insult to injury, even after the loan is paid off, the lender still has access to the victim’s data, allowing them to increase their profits by collecting and selling it to third parties until the phone gets replaced.
All of this has been made worse over the last year as many people throughout India have lost their jobs thanks to the response to COVID. Millions have found themselves going from working hard to get a little ahead to desperately scrambling to scrape by. Its left these people open and vulnerable to predators who have no regard for the people they are hurting while they are getting rich.
One way the Indian people can work towards ending this ridiculous cycle is to sign up with TARTLE. You can protect your data with us without giving us access to it. In fact, we never see our users’ data. We just give them the means to protect it. Once signed up, you can share your data on your own terms and make a little money in the process. Control over your data, financial compensation, and no harassment. That’s what TARTLE offers.
What’s your data worth? Sign up and join the TARTLE Marketplace with this link here.
They’ll give people a loan at an insanely high interest rate against the person’s next paycheck, and tend to lock people in a cycle of debt that is very hard to get out of.
Speaker 1 (00:06):
Welcome to Tartle cast with your hosts Alexander McCaig and Jason Rigby, where humanity steps into the future and resource data defines the path.
Alexander McCaig (00:24):
Oh, let's talk about the Indian rupees, huh?
Jason Rigby (00:30):
Yes.
Alexander McCaig (00:30):
Most people here in the United States they'll spend, I don't know, 10 bucks at Starbucks every single morning.
Jason Rigby (00:36):
Mm-hmm (affirmative).
Alexander McCaig (00:38):
That's about a quarter of the total salary somebody makes in a month in India doing basic material labor jobs that we would do here. So 40 bucks-
Jason Rigby (00:55):
40 bucks is a lot of money.
Alexander McCaig (00:56):
40 bucks over there feeds your entire family. It does a lot of things, helps pay your rent. Imagine that I can pay for rent and food with a $40 salary each month. Come on, this is crazy. Now there are ... This should be abundantly clear. There are great benefits to allowing people access to financial products.
Jason Rigby (01:25):
Yes, Fintech is great.
Alexander McCaig (01:27):
Fintech's great. And with a lot of good things, people tend to use it as opportunists and can have very negative effects on those individuals that are adopting these systems, looking for some financial help. And like most, a lot of technology companies have the ability to slide through regulatory cracks because of their design.
Alexander McCaig (01:55):
And what they realize is that there is a great need for Fintech lenders to go to these unbanked people in India and say, "Oh, you don't have 40 bucks this month?" We'll instantly loan you, no credit history, nothing, but you've got to give up all your data, your contacts-
Jason Rigby (02:18):
Text messages.
Alexander McCaig (02:19):
... text messages.
Jason Rigby (02:20):
Location.
Alexander McCaig (02:20):
Location. All these things where we're going to track you and then if you don't pay ... Okay? And by the way, because you have nothing to collateralize against it, we're going to give you a criminal interest rate, take all of your data and then make you pay back 100 X on that initial $40 loan in US dollars, okay? So what do you think that does to someone in a psychological standpoint, when they come into those stressors? You press them into a situation and you as this negatively oriented opportunistic Fintech company are coming in as a loan shark and dishing out loans to these people through slips in regulation that are just trying to survive because of the effects of this pandemic.
Alexander McCaig (03:17):
And you're trying to make a quick buck. And then you're going to ask them to pay back 10 years of labored salary or whatever it might be on this loan that they thought was going to help them just for a month's time. And if they don't pay it, we're going to take all your contacts, all your text messages and your location data. We're going to find out where you are. We're going to harass you in person. We're going to harass all your contacts, telling them that you haven't paid up, okay? And then we're going to just hammer you with text messages over and over and over and over.
Alexander McCaig (03:54):
So this is psychologically debilitating these individuals, which were already financially and emotionally strained and taken advantage of because they lack of financial literacy and financial access in their underdeveloped country. And these people who are doing this with these loan shark Fintech companies are just abusing the good nature, the rights in any economic equalization thought that could ever possibly be there in that country. And what you find is that this is driving people in India to suicide.
Jason Rigby (04:28):
Yes. And that's the problem.
Alexander McCaig (04:30):
For 40 bucks.
Jason Rigby (04:31):
Yes.
Alexander McCaig (04:31):
When someone said, "I got a quick fix for you, here's 40 bucks. Give me all your data, don't screw up. Oh, by the way, you screwed up. Now I'm just going to take all this stuff that was yours and just use all your data against you." This is a travesty.
Jason Rigby (04:48):
It is. Yeah.
Alexander McCaig (04:49):
And I want to say that this harassment with loans is not something new that happens in India. So sometime before these Fintech companies came in, if you were to take out a loan in India, the credit company would actually go send a collector to stand outside of your business or your home with a bull horn. And they would scream at you and tell everyone on the street just absolutely eroding your reputation and everything about you because you haven't been able to repay on time. They would hire guys to stand outside and and publicly degrade you, your family and your business. And now they've taken this to a whole new extreme where they're like, "We'll hire people in a digital format to digitally harass you and use your data against you."
Jason Rigby (05:32):
Yeah. It's so sad. There's a researcher at the Center for Long-Term Subject Security at the University of California, Berkeley.
Alexander McCaig (05:37):
Thanks for making me bend, I appreciate that.
Jason Rigby (05:39):
I know that was great, a hundred percent on that. And I'm sorry, I'm going to get her name wrong. Tarunima Prabhakar, she's that research ... She said this. The goals of rapid financial inclusion, consumer protection and data security are often in conflict. She said citing concerns, especially around unlicensed firms and getting meaningful consent of users on digital lending platforms.
Alexander McCaig (06:03):
Yeah.
Jason Rigby (06:04):
And then she said, "It's difficult for individuals to develop a full understanding of the consequences of sharing personal data."
Alexander McCaig (06:12):
The consequence for some of these people sharing that personal data and having no control over it over at that point, a consequence for some is suicide.
Jason Rigby (06:21):
Right.
Alexander McCaig (06:21):
Driving these people to suicide.
Jason Rigby (06:23):
Yes.
Alexander McCaig (06:23):
It's so important that you respect people and their data and you do not abuse it. And you certainly don't abuse it because you're try to get financial payment on high risk things that you already knew were high risk. This is a form of financial slavery that drives people to take their lives.
Jason Rigby (06:41):
And it's sad because now they're talking. The Indian government's talking about regulation, where it's, "Why can't we have conscious capitalism in the sense of where we have companies ..." It is their responsibility. A hundred percent, they're responsible. It's not the government's responsibility. It's not for you to get away with shit until, "Okay, now we're caught." And so now-
Alexander McCaig (07:02):
This is what I'm talking about, yeah.
Jason Rigby (07:03):
I hate that.
Alexander McCaig (07:03):
Why can't you be responsible ...? Why do laws have to be written in blood? Why can't you just consider the cause and effects and the anti-humanitarian values you pumped into your short-term game, junk Fintech company?
Jason Rigby (07:18):
Yeah.
Alexander McCaig (07:19):
And realized that this is really going to hurt people.
Jason Rigby (07:22):
Or say, "Hey, I get it. I get this. I know we can charge a little bit of an interest rate. We need to make a profit.
Alexander McCaig (07:30):
A little bit.
Jason Rigby (07:30):
A fair profit.
Alexander McCaig (07:31):
Their interest rates are like-
Jason Rigby (07:32):
Through the roof.
Alexander McCaig (07:33):
60, 80%.
Jason Rigby (07:35):
Yes.
Alexander McCaig (07:35):
Maybe more.
Jason Rigby (07:37):
And here's the crazy part. Not only are they now, now the government's stepping in and say, we need robust data governance, data privacy and data security standards, which can be bad or good when a government gets involved. We've seen that before.
Alexander McCaig (07:49):
Yeah.
Jason Rigby (07:50):
Depending on how their view of it is. And we're going to get into that in another episode of what the government's doing with data. But there's 190 million unbanked adults in India.
Alexander McCaig (08:00):
Out of the 1.8 billion people across the globe that are unbanked.
Jason Rigby (08:04):
Yes.
Alexander McCaig (08:04):
But they all interact with the global economy.
Jason Rigby (08:08):
And the Prime Minister there, Modi's, he's made financial inclusion of party as part of the ... And he has this program called, Digital India Mission.
Alexander McCaig (08:18):
DIM?
Jason Rigby (08:19):
Yes. But the sad part about-
Alexander McCaig (08:20):
That's not a good acronym.
Jason Rigby (08:21):
Yeah. The sad part about it is, you take these unbanked people and they're barely making it, family starving to death. A lot of them are on 25 of these apps. One individual could be on 25 of these apps.
Alexander McCaig (08:37):
And they're shelling out their data.
Jason Rigby (08:37):
Yeah.
Alexander McCaig (08:37):
Shelling it out in the hopes of getting a loan.
Jason Rigby (08:40):
Yeah. It gets their phone location data, contacts, apps and text messages. And that's how they judge because they don't have a credit score there. That's how they judge their credit risk assessment. Because algorithm is understanding, is going through all this personal data, too. And here's the sad part and we'll close on this Alex and I want you to speak to this. The sad part is, there's only a 15% approval rating. So what's happening there?
Alexander McCaig (09:05):
If I get 15% approval, how many apps do I need to be on?
Jason Rigby (09:08):
Mm-hmm (affirmative).
Alexander McCaig (09:10):
It's as simple as that, right?
Jason Rigby (09:12):
So the 85% of the other people, they're collecting their data.
Alexander McCaig (09:16):
Just renting it from them and they keep it.
Jason Rigby (09:18):
Yes.
Alexander McCaig (09:19):
And then they can then sell it off and do whatever they want with it after they've dropped it through the algorithm.
Jason Rigby (09:23):
And they didn't even get a loan for it but they got free data.
Alexander McCaig (09:25):
So I want to talk to India right now. Shout out to you guys. Forget those companies. Forget the loan sharks. Sign up on Tartle, control your data, have it respected by you, us and everybody that interacts with it. Keep it safe and never let it get used against you. Oh and by the way, get economically compensated for it.
Jason Rigby (09:45):
Yes.
Alexander McCaig (09:46):
Stop using these crap systems that abuse you. There's no interest for you to share your data. It's not going to be something negative that's ever pinned against you. You control it, you share it when you want to and you get paid for doing that. You get paid for being a good person. We're not going to put you in a hole for being a good person.
Jason Rigby (10:02):
Yeah. Tartle has absolutely no power over any person in their data.
Alexander McCaig (10:08):
No, absolutely not.
Jason Rigby (10:10):
We're just a marketplace.
Alexander McCaig (10:11):
We're just marketplace. We connect you between the buyers and sellers. You share, you get paid. I'll pay for those $40 worth of rupees.
Speaker 1 (10:25):
Thank you for listening to Tartle cast with your hosts, Alexander McCaig and Jason Rigby, where humanity steps into the future and resource data defines the path. What's your data worth?
