China cracks down on moneylenders targeting students

June 19, 2017

China is cracking down on online moneylenders who target university students, following concerns about the largely unregulated industry.

A recent government directive has ordered such lenders to suspend all activities wooing student borrowers.

The move follows reports of exorbitant interest rates and unsavoury practices in the industry, including demanding “nude selfies” as collateral.

Online peer-to-peer moneylending has grown popular in China in recent years.

Known as “wang dai” in Chinese, it sees strangers providing small loans to others via websites and phone apps.

‘Severely harmed their safety’

The directive (in Chinese) was made by China’s banking, education and social security authorities, according to a copy released by the Jiangxi provincial government on its website on Friday.

It said the measures were needed to address moneylenders “making extortionate loans” and other behaviour that has “severely harmed the safety of university students”.

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