(YicaiGlobal)
Jan. 16 — The Peer-to-Peer (P2P) industry lets investors side-step
banks to lend directly to borrowers. It has boomed in China. Borrowers
get easy access to credit. Lenders get higher returns than from bank
deposits. But scandals have tarnished P2P. The government is now
tightening the screws.
Several such ‘student loan’ scandals rocked China in 2016. P2P
platform Jiedaibao was accused of offering small loans to co-eds at a
usurious 30 interest rate in exchange for nude photos of them holding ID
cards. If default occurs, these images appear on the web and are sent
to family and friends.
Most Loanbao female borrowers were born between 1993 and 1997. A
photo shows a topless girl with an IOU blocking her bosom that reads
“I’m [NAME], I borrowed CNY6,000 (USD900) from [NAME] through LoanBao at
a monthly interest rate of CNY400. The loan is for one month. I take
sole responsibility for failing to repay the loan on time.”
Borrowers must use their real names, while lenders can employ
pseudonyms. Beijing Happy Times Technology Co., also withdrew from the
‘student loan’ market when facing ‘revenge pawn’ allegations.
Pawnography of this kind may also hold residual value for
bottom-feeding investors, and even spawn a secondary market. It has
already formed a sort of unofficial credit reporting system … in more
than one sense. Perhaps Sallie Mae should explore similarly creative
student-loan securitization measures.
That’s all, folks. Now, if you’ll excuse me, I’ve got to go and collect a debt.
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