Country 3 out of every 5 people in the country believe that it is normal to exaggerate income in loan applications. This has come to light in a survey conducted to know people's opinion about financial fraud. A survey by global analysis software company FICO says that more than a quarter (27 percent) of Indians believe that it is normal for people to deliberately misrepresent their income in home loan or other loan applications.
Financial integrity is getting more complicated
According to the survey, “3 out of 5 people (63 percent) believe it is okay or normal to overstate one’s income in loan applications, which is much higher than the global average of 39 percent.” The global survey conducted on 1000 people in India says that more than half (54 percent) of the people believe it is normal to fake insurance claims. Many Indians also consider it okay to overstate income in personal loan applications, making financial integrity even more complicated.
Banks are facing fake loans
Only one-third (33 percent) of consumers believe that it is never acceptable to overstate income in a personal loan application, while one-third (35 percent) believe it is acceptable under certain circumstances. Ashish Sharma, Head of Risk Lifecycle and Decision Management, Asia Pacific Region, FICO, said, “More than 60 percent of Indian consumers consider it acceptable or acceptable to understate income. Banks are facing a real problem of 'false loans', which can distort risk assessments and increase bad loan rates.”
People's thinking is quite different in other countries
The survey covered nearly 1,000 Indian adults as well as nearly 12,000 others from Canada, the US, Brazil, Colombia, Mexico, the Philippines, Indonesia, Malaysia, Singapore, Thailand, the UK and Spain. Globally, the perceptions vary widely. The survey shows that 56 per cent of people consider the idea of exaggerating income on a loan application completely wrong and would never accept it. Only 1 in 4 (24 per cent) think it is okay in some circumstances and only 1 in 7 (15 per cent) think it is normal, the report says.
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