Fake Salary Slip/Documents for Personal Loan: 6 Dangerous Implications
You can get financing for anything – medical expenses, marriage, child’s education, buying car and house, etc. And personal loan is the most ideal choice of borrowers. There are plenty of lenders out there in the market to attract potential customers with various offers for loan. Anyone – salaried, self-employed, businessmen, and others can get loan.
However income proof of the borrower is the most important document required by the lender before approval. Borrower’s monthly/annual income plays a key role in evaluation of credit worthiness. And for the lenders to verify the income stated while filling up the application proof, of the salaried or self-employed individual, monthly salary slip, IT return or bank statement is the only document.
However many employers in India still offer salary in cash. So for such employees, getting a personal loan becomes extremely difficult. This is because, lenders have no way to verify the source of income. In some companies or freelancing jobs, individuals are not given salary slip, which again creates problems when applying for a loan.
And it is very common scenario that borrowers generate fake salary slip and other documents such as bank statement, IT return, Form 16, duplicate PAN card etc. to get a loan. This also applies to individuals who are earning low salary as well. Applicants use software to generate fake documents easily. But forging the documents comes with unforeseen risks.
Additional reading: Personal loan for low salaried person.
And borrowers are not aware of the implications of providing fake documents for getting any type of financing including personal loan. And most importantly they are unknown of intelligence used by the banks to identify genuine loan applications.
Here are the implications of fake salary slip for personal loan:
Legal prosecution: If someone manages to fake pay slip and get loan, then lender has complete authority to take legal route if this is cross verified. And if this happens, future will be at risk. And probability is extremely high that no employer will offer job in the future. If forging the documents go unnoticed at the time of application verification and someone managed to procure loan but later that person fails to repay loan then lenders can take legal route and confiscate bank account or other property and criminal proceedings will follow. The borrower may even end up in the prison and the whole life will become miserable.
Lose employer’s trust: If lender verifies applicant’s income from his/her employer then it can put the trust at stake and may also result in job loss. And getting a new one will become difficult, as you may not get experience letter or relieving letter from the existing employer.
Credit score downgrade: Such frauds will straightaway result in downgrading of credit rating.
No bank loan in the future: Because of credit score downgrade, no lender will offer financing or credit card in the future.
Immigration problem: If criminal case is booked then moving out of country will become impossible. Most countries ask and verify criminal case on the visa applicant’s name. If you do not have passport, then getting the same will be problem.
PAN card blacklisted: Most importantly, PAN card may get blacklisted for the life. And getting a new one will be impossible.
Remember that faking anything in today’s world is illegal. One mistake can ruin the life.
This article has been written by Chandra Mehta.
Chandra is a seasoned banker with 35+ years of experience in banking and financial services industry. He’s a retired banker and has served as Chief Manager and Assistant Vice President in State Bank of India/or its subsidiaries.
He has authored many articles on this site (allonmoney.com).