Chinese Innovation: Nude Photo Loan Platform Adds Uber-Style Debt Collectors Feature
from the uberizing-everything-everywhere dept
Back in June, Western media picked up on a sordid tale involving the Chinese company Jiedaibao, a platform which facilitates loans between individual lenders and borrowers. Because of the private nature of the deals, loan sharks came up with a new twist on securing collateral for the money they lend out at exorbitant rates, described here by China.org.cn:
They often ask female students to pose naked with their ID and use these photos as collateral in their practice. If a student defaults on the loan, the loaners will threaten to show the nude photos to her family and friends.
Being able to borrow even more money at these ruinous interest rates just means the women get into deeper trouble even faster. When criticized for allowing this sexual and economic exploitation, Jiedaibao initially said:
In exchange, the students who agree to send nude photos can have a higher loan amount, ranging from 2 to five times as much. However, the loan interest rate can be as high as 30 percent a week.The usury and nude collateral practices are part of a private trade deal between users. As a result, the company cannot interfere, and assert that users have to shoulder these risks by themselves. However, if these scenarios get worse, they urge users to contact the police.
Perhaps realizing that this didn't really sound too good, the company later tweaked its response slightly, as the Guardian reported:
A spokesman for Jiedaibao condemned the "naked loans" and said the company would work with the police on any investigation of such practices. "This kind of naked loan is actually taking advantage of the online platform to operate an illegal usurious offline business," they said.
Despite that (feeble) condemnation, and the outrage this modern-day usury provoked in China, the abuse seems to have continued. Last month, China.org.cn published another article on the topic, where it noted that some women have been been coerced into prostitution in an attempt to pay off the money they owe to unscrupulous lenders. According to a more recent story in the South China Morning Post (SCMP), Jiedaibao's size -- it has more than 128 million users with a cumulative turnover of about $12 billion -- and lack control over the private deals made using its platform have led to the development of a serious problem:
Without proper credit risk assessments, many of the loans have soured, raising demand for debt collectors. Online chat groups have sprung up offering advice on recovering the money. Tips include repeated calls to debtors, calling debtors' relatives and paying "beggars" to protest near a debtor's home.
To address this issue, Jiedaibao has come up with a rather remarkable new feature for its platform:
Users of its app can apply to recover debts owed through the platform by uploading their ID card number and a photo.
Some may applaud Jiedaibao's idea of creating an Uber-like crowd of private debt collectors, but the scope for abuse is clear. And those suddenly finding themselves on the receiving end of these amateur debt collectors are unlikely to be so enthusiastic about Jiedaibao's innovative approach.
After a "verification" process of about a week, successful applicants gain access to overdue borrowers' phone numbers, addresses and even ID numbers, with commissions of up to 40 per cent of the original loan for recovering the outstanding amounts.
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Filed Under: china, debt collection, debt collectors, gig economy, nude photos
Companies: jiedaibao
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*#&!-ers taking advantage of people in bad situations... always makes me mad.
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I think Anthony Weiner flooded the market.
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Re: Re: HACKER FOR HIRE.
I could have been a fucking Crime Lord then! WTF was I thinking getting a white collar job and enjoying life like a civil fucking human being?
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Re: HACKER FOR HIRE.
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Khomeini had a good idea...
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Re: HACKER FOR HIRE.
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I'll believe it when I see it
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their government-issue ident through a central repository
[Jiedaibao] in relation to an ongoing criminal enterprise.
Naturally Jiedaibao is required to retain records because "terrorism". ;]
I'm sure the chinese government will find this handy when
party executives decide it's time to generate some positive
press for themselves and the party.
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Yes, sometimes genuine misfortune leads people into lesser of two evils situations, but I suspect the vast majority of these cases are simply irresponsible spending, bad decision making, and the cascading consequences thereof.
That doesn't mean that the lenders aren't horrible human beings, but unless someone was holding a gun to a head while brandishing a loan contract, the borrowers made the choice to do business with those horrible human beings.
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Moving costs, so moving to where the jobs are isn't that easy.
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