Spotting loan scams: 7 tricks to watch out for

When you urgently need money, it is easy to let your guard down. Scammers know this, and they use lines like "no documents needed", "instant approval" and "guaranteed payout" to draw people in. The scripts change, but the goal rarely does: get you to transfer money first, hand over your account details, or accept huge costs hidden in fees.

This guide shows what a genuine loan process looks like, walks through 7 common tricks and the line that gives each one away, and explains what to do in the first hour if you think you have been caught. It is worth sharing with older relatives and young adults taking their first loan.

What a genuine loan process looks like

Scams work best when you don't know what normal looks like. Here is how a loan through AXAI Credit works. Licensed lenders generally follow a similar pattern.

1. You apply on our website. The form takes about 3 minutes. It does not ask for your IC number, your banking password or any payment. Nothing is approved on the website.
2. An adviser continues with you on WhatsApp from the official number on our Contact page. They ask about what the loan is for, your income and your existing commitments, and may ask for income documents such as payslips or bank statements.
3. Our licensed lending partner checks your credit. With your consent, it checks your CCRIS and CTOS records after you apply.
4. You see the offer before you sign. The adviser confirms the amount, annual rate, tenure, monthly instalment and total repayable. You can check the numbers yourself with a calculator.
5. You sign the agreement with the licensed lender. Your MyKad is verified at signing. The agreement names the lender and shows its licence number.
6. The money goes into your own bank account, in full. We charge no processing or admin fees, so nothing is deducted from the payout.
7. You repay to the lender's official company account by bank transfer, FPX or JomPAY. Never to a personal account.

Notice what is missing from this list: there is no step where you pay anything before receiving the money, no OTP or TAC code, no app to install, and no personal bank account. Our page on how to know it's really us lists our official contact details and everything we will never ask for.

Fee traps before the loan is paid out

Trick 1: pay a fee before you get the money

The scammer asks you to transfer money before the loan is released, calling it a "processing fee", "deposit", "insurance", "stamp duty", "first instalment in advance" or "release fee". After you pay one, another appears, each with a more convincing reason. The promised loan never arrives.

The giveaway: any request to pay before money reaches your account. A legitimate lender will never ask you to transfer money to a personal account before your loan is paid out.

AXAI Credit charges no processing or service fees, and we never ask for any payment before disbursement.

Trick 2: "your payout is frozen" or "your account needs more balance"

After you apply, someone tells you that "your bank account number was entered wrongly, so the funds are frozen", or that "your statement doesn't show enough money, so you need to deposit some to prove you can repay". You are asked to pay a named account to "unfreeze" the loan, often after receiving a fake "approval letter" or transfer screenshot.

The giveaway: a payout that exists only in a screenshot, plus a request to pay to release it. A genuine lender that finds an error asks you to correct your details through its official channels, never to pay.

Impersonation and stealing your details

Trick 3: fake bank, police or authority officers

Often called the "Macau scam", this starts with a call from someone claiming to be from a bank, the police, Bank Negara Malaysia, a court or another authority. They say your name is linked to a loan, a crime or an unpaid debt, and that your CCRIS or CTOS record will be damaged, or you will be arrested, unless you act now. The call is often "transferred" to a second person posing as a senior officer. Step by step, they persuade you to move money to a "safe account", or even to take out loans and hand the money over.

The giveaway: pressure, secrecy ("don't tell your family, this is confidential") and a request to move money. No real bank or authority will ask you to move your money for safekeeping, and anyone who asks you to borrow money and hand it over is a scammer.

To check, hang up and call the organisation yourself using the number on its official website. AXAI Credit's hotline is 011-2102 9366. Never use a number given to you in a text message or chat.

Trick 4: asking for your TAC or OTP, or to install an app

Someone offers to "speed up your approval" or "help you with the application", then asks for the TAC or OTP sent to your phone, your online banking password, or for you to install an app or open a file (often an APK file sent over WhatsApp) or share your screen. Once you do, they can see everything you type, read the codes your bank sends, and move money straight out of your account.

The giveaway: any request for a code, a password, remote access or an app outside the official app stores. Your TAC, OTP and passwords are for you alone. A lender does not need them to pay money into your account.

Trick 5: fake websites, apps and social media pages

Scammers build websites, apps and Facebook or Instagram pages that look almost identical to real lenders, sometimes with a name one letter different or a copied licence number, then send links by SMS, WhatsApp or paid ads. The page asks for your MyKad number, bank login and a TAC.

The giveaway: a link you did not search for yourself, or a page that asks for banking login details. Type the lender's address yourself, don't scan QR codes from unknown sources, and only install apps from official app stores. If a page shows a licence number, check it with KPKT, as explained in our guide on how to check a licensed moneylender.

False promises and hidden costs

Trick 6: "guaranteed approval", "blacklisted also can"

Whether a loan is approved depends on the lender's assessment of your ability to repay and your credit history. Nobody can guarantee approval. Offers such as "CCRIS or CTOS problem also can", "inside connection" or "pay us to clean your record" either disappear with your money or push you towards very expensive borrowing, sometimes from unlicensed moneylenders (Ah Long).

The giveaway: a promise made before anyone has looked at your income or credit. Your credit record cannot be wiped by paying someone. It improves with time and on-time repayments. If you want to understand what is actually in your record, see our guide to credit report basics.

Trick 7: front-end deductions and hidden fees

Some lenders write RM 5,000 into the agreement, but deduct a "service fee" or "consultation fee" before paying you. Let's do the maths:

• Loan agreement for RM 5,000 at 12% a year, 12 equal monthly instalments of about RM 444.24
• RM 1,000 is deducted upfront, so you actually receive only RM 4,000
• Paying RM 444.24 a month on the RM 4,000 you received works out to an effective annual cost of about 56.66%

It looks like 12%, but the real cost is more than four times higher. Even measured the way the legal cap is applied in practice (simple interest on the money you actually received), RM 1,330.93 on RM 4,000 for one year is about 33%, far above the 18% a year cap for unsecured loans from licensed moneylenders. And a licensed moneylender may not deduct a fee like this at all: under the Moneylenders Act 1951 (section 23), the only costs it can pass on to you are stamp duty, fees required by law and legal costs. Even a smaller deduction matters: if only RM 500 were deducted, you would receive RM 4,500 and the same instalments would work out to about 32.50% a year on a reducing balance.

The giveaway: the amount reaching your account is lower than the loan amount in the agreement, or someone tells you a fee "will be taken from the loan". For comparison, a RM 5,000 personal loan from us over 12 months at 4.9% a year is about RM 427.81 a month, RM 5,133.70 in total, and the full RM 5,000 is paid into your account. Every approved customer pays the same 4.9% a year.

A 60-second check before you pay, share or sign

One wrong answer is enough to stop and verify.

• Did I find this lender myself? Unsolicited SMS, WhatsApp or social media offers are a common starting point for scams.
• Have I checked the lender's exact name and licence number with KPKT (for example in KPKT's i-KrediKom app)?
• Does every payment go to a company account in the lender's name? Never to an individual, or to a "new account" announced by message.
• Will the full loan amount reach my own bank account?
• Have I seen the annual rate, instalment and total repayable in writing? Our loan agreement guide explains what a proper agreement contains.
• Am I being rushed, or asked to keep it secret?
• Has anyone asked for a code, password, app install or screen share?

What legitimate lenders do ask for

Not every request is suspicious. Payslips, bank statements, EPF statements (or business statements and tax filings if you are self-employed), consent to check CCRIS and CTOS, MyKad verification at signing, and a bank account in your own name are all normal. What makes a request a red flag is the channel and the purpose: a payslip sent to the lender's official WhatsApp number is normal; photos of your MyKad and ATM card, or your banking login, sent to a number that contacted you out of the blue are not.

Don't lend your bank account

A newer variation targets people who were rejected or need money fast. The "lender" says it will deposit money into your account to "build your statement" or "test the account", and asks you to transfer it onwards, or to hand over your ATM card and online banking. In reality, your account is being used to move stolen money. This is known as a money mule account, and the account holder can face police investigation and have the account frozen, even if they did not know where the money came from.

Never let anyone else use your account, card or banking app, and never pass on money that arrives from someone you do not know.

If something feels wrong: the first hour

1. Stop transferring money immediately. Do not be persuaded by further explanations or pressure. Stop replying and do not click any more links.
2. Call your bank's fraud line using the number on the back of your card or on the bank's official website. Ask them to block your cards and online banking if you shared any codes or installed an app.
3. Call the National Scam Response Centre on 997 as soon as possible if you have transferred money. The earlier the report, the better the chance that funds can be traced and frozen. Then make a police report.
4. Keep evidence: chat logs, call records, transfer receipts, account numbers, phone numbers and website addresses. Take screenshots before the scammer deletes messages.
5. Change your passwords for online banking and email, and uninstall any app you were told to install. If an APK was installed, ask your bank whether you should reset the phone.
6. Watch your credit record. If you sent a copy of your MyKad, check your CCRIS and CTOS reports over the following months for loans or applications you do not recognise.

If someone pretended to be AXAI Credit, please also tell us through our official channels so we can warn other customers.

When you are being pushed towards a bad loan

Scams thrive on desperation. If you are tempted by a lender you cannot verify because you were rejected elsewhere, first ask your existing lenders for a payment arrangement, use savings or family help for part of the amount, or contact AKPK, the agency set up by Bank Negara Malaysia that offers free credit counselling and a Debt Management Programme. Borrowing from an unlicensed lender to fix a short-term problem usually creates a bigger one.

Summary

A genuine loan looks like this: apply through an official channel, get a written offer, sign with a licensed lender, receive the full amount in your own account, and repay to a company account. The seven giveaways are paying before payout, a "frozen" payout, pressure from fake officers, requests for codes or apps, links you did not search for, guaranteed approval, and deductions from the loan amount. If anything feels wrong, stop paying, call your bank and 997, and keep the evidence. If a message claims to be from AXAI Credit and you have doubts, call our official hotline on 011-2102 9366 to check.

This article is general information only and is not personal financial advice. Approval and loan amounts are subject to assessment and your loan agreement. How we write and check our guides