PAN misused for fraudulent loan? How to detect & restore credit score

Hidden loans can quietly hurt your credit score; here's how to catch and fix them promptly

A loan fraudulently taken on your permanent account number (PAN) can wreck your credit score and you may not even know about it until a bank rejects your credit application.

 

Here is how to detect and dispute a fraudulent loan before the damage spreads.

 

Start with your credit report

 

Every loan and credit card issued in India is reported to credit information companies authorised by the Reserve Bank of India. This means your credit report is the first place to check.

 

You are entitled to one free credit report each year from each of the four major bureaus:

 

 

• TransUnion CIBIL
• Experian
• Equifax
• CRIF High Mark

 

Download the report directly from their websites. In the “account information” or “loan details” section, look for:

 

• Personal loans or credit cards you do not recognise
• Loans from unfamiliar companies
• Hard enquiries from institutions where you never applied
• Even a small-ticket loan is a red flag. Fraudsters often begin with modest amounts to avoid immediate detection.

 

Track your credit activity regularly

 

Several fintech platforms now allow users to monitor their credit profile and linked loans in one place. Apps such as CRED, Paytm, OneScore and Google Pay provide access to credit score updates and recent credit activity.

 

Enable real-time alerts wherever available. A new loan entry or enquiry notification can give you an early warning.

 

Check your bank statements

 

Fraud does not always surface in your credit report first. Review monthly bank statements for:

 

• Unknown EMI debits
• Recurring payments to lenders you do not recognise
• Small but regular deductions

These transactions are often overlooked, particularly if the EMI is modest.

 

If you find a fraudulent loan

 

Act without delay:

 

Inform the lender in writing and request an immediate freeze and investigation.

 

• Raise a dispute with the credit bureau concerned through its online portal. Most disputes are processed within 30 days.
• Report the incident on the government’s cybercrime portal or call the national helpline 1930.
• File a police complaint for identity theft to strengthen your case.
• Continue following up until the loan is removed from your record and your score is corrected.

 

Quarterly credit checks may seem excessive but in an era of instant digital loans, regular monitoring is standard safety practice.