The Ministry of Corporate Affairs ( MCA ) is considering removing 400 Chinese online loan and job firms operating across 17 states nationwide, says the reports. These companies have been implicated in fraudulent activities and user harassment.
Moneycontrol reported the news based on information from an anonymous government official. These Chinese firms operated in high-density areas such as Mumbai and Delhi, where a large, desperate job-seeking population made individuals more vulnerable to fraudulent activities.
The official said to the Moneycontrol that the inquiry into nearly 600 Chinese companies has been completed, with a significant number, estimated between 300 to 400, expected to be struck off. This includes various loan apps and online job companies.
The ongoing diplomatic tensions between India and China are likely to escalate with the Ministry of Corporate Affairs ( MCA ) decision to deregister Chinese apps. This move is expected to face significant backlash from China.
The MCA has been scrutinising digital loan apps suspected of predatory lending, fraud, and regulatory violations due to the rapid expansion of such apps in India, many of which are linked to Chinese firms.
These fraudulent apps have been targeting Indian citizens, causing substantial financial losses and harassment. By deregistering these companies, the MCA aims to protect citizens from exploitative practices, including exorbitant interest rates and aggressive collection tactics.
Since 2020, the Indian government has actively banned Chinese applications to safeguard national security. Over 250 Chinese apps, including well-known ones like TikTok, PUBG, Shein, and CamScanner, have been prohibited. These bans are justified on grounds that these apps are “prejudicial to the sovereignty and integrity of India, defence of India, security of the state, and public order.”
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