Chinese Innovation: Nude Photos as P2P Loan Collateral

Taking KYC (Know-Your-Customer) over the line!

One of the main issues that face new peer-to-peer or crowd lending platforms is how to create trust among potential lenders that the borrowers will actually pay out. Well startups, worry no more, Chinese loan sharks have solved the problem!

According to reports from China, online lenders are demanding that female clients send them naked photos of themselves in order to get access to loans. The idea being that in case of a failure to repay the debt, the lenders will publish the images on social media as a threat that will keep the borrowers in line.

The images must include a view of the ID card of the borrower and be sent from their private social media apps (WeChat), apparently in order to both verify their identity and prevent claims that it is not them in the image for maximum embarrassment. The main arena for this business is Jiedaibao, a Chinese anonymous social network-based P2P lending platform.

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The issue is being widely reported in China now, due to its viral quality, and many personal stories from lenders are coming to light. It seems loan sharks on Jiedaibao are charging exorbitant interest rates of around 30% for sums ranging from just tens of dollars to thousands of dollars in loans.

Some female university students are even reporting that they have taken a part in this business ordeal and were later faced with online sexual abuse. Moreover, some of the more unscrupulous loan sharks are even selling the naked photos in online forums regardless of the status of the loan just to make more money at the expense of the borrowers’ privacy.

Southern Metropolis’ Daily
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