Online loan sharks demand nude selfies from borrowers as collateral

Sleazy online lenders in China are giving students loans so long as the students send along naked photos as collateral. The loan sharks threaten people who fail to pay with posting the photos online as well as sending the pics to their families.

partial nude
Credit: Mario Antonio Pena Zapatería

How hard up for cash would you need to be to give an online loan shark your nude picture as collateral? A borrower is required to hold up a valid ID in the naked selfie. If you don’t pay the loan with exorbitant interest back, then the selfie exposing your bare bits is sent to your family members and posted online. This is apparently a common practice in China, especially by students needing money for college.  

There is nothing new about naked IOUs, an insider told People’s Daily Online, and many people borrow money with nude pictures as collateral. “Once a clear photo of a naked borrower holding his or her ID card is uploaded to lenders, he or she can get up to 15,000 yuan ($2,277) credit with a maximum of 36 month installments.”

Naked selfies as collateral for loan Southern Metropolis Daily

One example of the practice comes from “Li Li,” a Chinese university student. She claims to have borrowed the equivalent of $76 (500 yuan) from on online loan shark in February. That loan required students “to provide photocopies of their identity cards, student cards and family data, plus their nude photos, before they were granted a loan.”

There are conflicting reports as to whether the interest rate was 30 percent per week or per year, but trying to read a translated version of the original story is a bit of a confusing nightmare. At any rate, Li Li could not pay the money back, so she kept borrowing more from the same site, Jiedaibao, which is described as an “anonymous social circle based P2P lending platform.”

Once her additional loan and interest reached about $8,352 (55,000 yuan), and she tried to borrow more, the online loan shark demanded her naked photo as collateral. She complied, yet failed to make payments on the loan, and then attempted to borrow even more. The lender then threatened to send her naked selfie to her family.

Several Chinese news sites reported that the nude photos get posted online as well as sent to family listed in the original loan application. Naked IOU loans are not illegal in China where it is difficult to obtain a state-funded loan for college.

The amount a person can borrow is directly related to their education background. “Usually an undergraduate student can receive 15,000 yuan (about $2,278) in credit, while those studying at famous universities as well as doctorate students can receive even larger loans,” reported People’s Daily Online.

Intrigued, the site Sixth Tone set out to obtain a loan from such a loan shark and applied to one of many found on the microblogging platform Weibo. After posing as a student, reporter Nathan Jubb said, “The middleman agreed to lend 3,000 yuan ($455) in exchange for a nude photo and details of the applicant’s relatives and classmates. The agent also requested detailed personal information including the university of study, student number, and home address, but made no attempt to assess the reporter’s ability to pay back the loan.”

“Some students who failed to repay their debts in time have sought police help, accompanied by their parents, after being threatened with sexual violence or having their nude photos published online,” reported The Strait Times.

Since the creepy practice is hitting the proverbial fan, some sites where naked photos have been used as collateral claim to be investigating.

Jiedaibao, for example, originally claimed it had no control over “naked loans” – the collateral demands were by made a lender “of a private trade deal.” But Jiedaibao flip-flopped, telling The Guardian, “This kind of naked loan is actually taking advantage of the online platform to operate an illegal usurious offline business.”

Others lenders are reportedly sending messages via Tencent's QQ to say they are no longer accepting nude selfies as collateral.

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