Shadows Of Credit: Informal Lending Through Social Media And Digital Platforms

Abstract

Traditional financial institutions, especially financial institutions and NBFCs, frequently have strict eligibility requirements that prevent individuals who are vulnerable from obtaining loan.  Social networking sites like Facebook, Instagram, Telegram, and WhatsApp have developed into informal money networks as a result.  These devices help distributed social organizations, loan networks, and digitalized ROSCAs that grow.  This study examines these informal loan arrangements' structure, risk motion, and macroeconomic consequences.  It draws on supplementary research and online ethnography to emphasize how these tools both expose users to innovative dangers and help close money gaps. Investigations from Argentine and Zimbabwe show that informal norms, reputation, and respect replace official credit rating, changing how people behave financially.  A reasonable legislative strategy is recommended by the investigation in order to safeguard customers while impeding centered around communities innovation.