Chinese Innovation: Nude Photo Loan Platform Adds Uber-Style Debt Collectors Feature

They usually ask female students to pose naked with their ID and use these photographs as collateral in their practice. If a student defaults on the loan, the loaners will threaten to show the nude photographs to her family and close friends.

In exchange, the students who agree to send nude images can have a larger loan quantity, ranging from 2 to 5 occasions as a lot. Nonetheless, the loan rate of interest might be as higher as 30 percent a week.
Being able to borrow much more cash at these ruinous rates of interest just means the girls get into deeper trouble even more quickly. When criticized for allowing this sexual and financial exploitation, Jiedaibao initially said:
The usury and nude collateral practices are part of a private trade deal in between users. Because of this, the enterprise can't interfere, and assert that customers must shoulder these dangers by themselves. On the other hand, if these scenarios get worse, they urge customers to contact the police.
Probably realizing that this did not really sound too good, the enterprise later tweaked its response slightly, because the Guardian reported:
A spokesman for Jiedaibao condemned the "naked loans" and said the firm would perform with the police on any investigation of such practices. "This sort of naked loan is actually taking advantage with the on the internet platform to operate an illegal usurious offline company," they stated.

Despite that (feeble) condemnation, along with the outrage this modern-day usury provoked in China, the abuse appears to have continued. Final month, China.org.cn published an additional post on the topic, where it noted that some girls have already been been coerced into prostitution in an try to spend off the cash they owe to unscrupulous lenders. Based on a a lot more current story in the South China Morning Post (SCMP), Jiedaibao's size -- it has greater than 128 million users having a cumulative turnover of about $12 billion -- and lack control more than the private offers created using its platform have led towards the improvement of a critical dilemma:
Without having suitable credit risk assessments, a lot of of your loans have soured, raising demand for debt collectors. On-line chat groups have sprung up providing assistance on recovering the cash. Guidelines involve repeated calls to debtors, calling debtors' relatives and paying "beggars" to protest near a debtor's household.
To address this issue, Jiedaibao has come up using a rather exceptional new function for its platform:
Users of its app can apply to recover debts owed by means of the platform by uploading their ID card quantity and a photo.

Following a "verification" procedure of about a week, profitable applicants obtain access to overdue borrowers' telephone numbers, addresses and in some cases ID numbers, with commissions of up to 40 per cent from the original loan for recovering the outstanding amounts.
Some may perhaps applaud Jiedaibao's concept of building an Uber-like crowd of private debt collectors, however the scope for abuse is clear. And these suddenly obtaining themselves on the getting finish of those amateur debt collectors are unlikely to become so enthusiastic about Jiedaibao's innovative method.