The Negative Impact of Online Loans on University Students

Abstract

This study aims to analyze the negative impact of online loans on university students, focusing on financial behavior, psychological well-being, and academic performance. The rapid advancement of financial technology has made online lending platforms easily accessible, allowing students to borrow funds instantly without complex requirements. Although these services offer short-term financial convenience, they often create serious problems such as excessive debt, financial dependency, and emotional stress. This research employs a descriptive qualitative method through interviews and questionnaires distributed to students who have used online loan applications. The findings reveal that most students experience financial instability due to poor money management, high interest rates, and lack of awareness about repayment obligations. Furthermore, debt accumulation leads to anxiety, reduced focus in learning, and declining academic outcomes. Peer influence, low financial literacy, and consumerist culture are identified as dominant factors that encourage impulsive borrowing behavior. The study highlights the importance of improving financial education and awareness programs at the university level, along with the need for strict regulation of digital lending practices. Overall, while online loans provide short-term access to credit, their long-term consequences can negatively affect students’ financial health, emotional stability, and academic achievement.