How Banks and Microfinance Institutions Push Unnecessary Services with Online Loans

Often, when taking out a loan or credit, people end up receiving additional services such as insurance, subscriptions, SMS notifications, legal consultations, and other paid services. Overpaying for such services can be significant, while the service itself may be useless for the borrower.

Some lenders use all sorts of tricks to make sure the client does not realize that these services can be declined. Often, they do not even break the law — they simply test your attentiveness or exploit trust. Let’s look at the most common ways additional services are imposed when concluding an online loan agreement.

Pre-checked Boxes

By law, banks and microfinance organizations are not allowed to pre-check boxes that signify the borrower’s consent to additional services when applying for a loan. However, some websites display such pre-checked boxes, and if you try to uncheck them, a “technical error” occurs. You simply cannot move to the next step and submit your loan application.

It’s better to avoid such violators entirely and choose another bank or microfinance institution.

Sometimes, automatic checkmarks appear later, not during the initial loan application. For example, if you want to extend a loan or make an early repayment, you may need to submit a separate online request. This request may also list additional services with pre-checked consent boxes.

One Checkbox — Multiple Services

Along with a loan, a bank or microfinance institution might offer insurance that supposedly reduces the interest rate. A borrower agrees by checking a box labeled something like “insurance services” and may not realize they are purchasing multiple policies.

Only one policy — the relatively inexpensive one — affects the loan interest. The others, often unnecessary, just increase costs, sometimes by tens of thousands of rubles.

The solution is to carefully check what is hidden behind each checkbox and vague wording. Read all conditions carefully, including small print or footnotes.

Service Description Hidden Under an Unnoticeable Link

At one stage of the loan application, the borrower may see a phrase like “agree to the following” or “financial protection” next to a checkbox. It’s often impossible to understand that the checkbox is linked to an additional service. The borrower assumes they are agreeing to loan terms or conditions. Selecting “financial protection” seems like it will not change interest rates or other contract parameters.

The phrase often looks like normal text but is actually a hyperlink. Clicking it takes you to a page with more or less clear information about what you agreed to — for example, an SMS notification service or insurance against job loss. But perhaps you are on maternity leave or retired, so job loss isn’t a concern, and you do not want bank notifications.

Understand that each checkbox could confirm the purchase of unnecessary services. Do not tick anything until you know exactly what it means.

Declining Additional Services Masquerades as Refusing the Loan

When filling out an online loan application, you may need to select “sign the contract” or “decline the application.” This creates the illusion that it refers to the loan itself, but in reality, unscrupulous lenders hide the option to decline additional services under these buttons.

If you click “sign the contract,” you agree to a service; if you click “decline the application,” you simply move to the next step. Sometimes the online application does not even mention the service, which is hidden in supplementary agreements or “special offers” on the lender’s website.

To understand what the lender is asking you to agree to, you may need to spend a lot of time. Before signing, always verify that the loan amount in the contract matches what you are borrowing.

Often, borrowers only realize they agreed to a service when the lender immediately deducts part of the loan for the additional service. In such cases, extra services can usually be canceled afterward, and your money returned.

Claiming the Loan Without Extra Services Can Only Be Done In-Branch

Sometimes banks include an additional paid option in the online loan contract and do not allow you to decline it via the website or app. You can only do this in person at a branch. This condition is designed to make the borrower unwilling to spend extra time, leading them to pay for the unnecessary service.

If you do not want to fall for this, you either have to visit the bank in person or look for another offer.

Checkbox Needed to Decline a Service

Most of the time, checkboxes are used to agree to something. In this case, the opposite occurs — the checkbox is required to decline an additional service. Insurance or other services may already be included in the contract by default. The opt-out box is often visually unremarkable, making it easy to overlook.

To avoid paying for unnecessary services, read every line carefully and do not skip anything.

Promises of Discounts That Don’t Exist

Microfinance organizations may mislead borrowers with “special prices” for additional services. For example, two amounts may be displayed, with the higher one crossed out. The borrower interprets this as a discount and expects to pay the lower amount.

However, checking the final contract often reveals that there is no discount — the full service cost is included, and the crossed-out number is purely a marketing trick. There is no information on who qualifies for the “special price.”

The only way to avoid falling for this illusion is to calculate in advance the cost of the loan without additional services and not sign the contract until the correct amount is shown.

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