Beware Loan Sharks with Unconventional Loan Collaterals

beware of loan sharks

According to Southern Metropolis Daily, loan sharks found a new and unconventional way to guarantee for loans. They ask female university students for nude photos in order to get a loan.

Loan sharks and their unconventional loan collaterals

What is the newest collateral for a loan? Naked pictures of students. More and more loan sharks based in China ask cash-strapped female students to send them nude photos of themselves, along with a copy of their ID card, as unconventional loan collateral.

Students are warned that if they do not make their payments on time, the pictures will be published.

According to the mentioned newspaper, a young female student borrowed first only 500 Yuan, which is the equivalent of $100 AUD. She took the loan from an online lender, and the interest rate was 30 percent per week. Then, being unable to pay the first loan on time, she took a new one and then a new one, and so on. Soon, she had a debt of 55,000 Yuan or $11,300 AUD. At that moment, her lender demanded a naked photo of her, as a sort of collateral for a new loan.

The Chinese student told the newspaper that she was not the only one in this situation. In fact, she knows many female classmates who were asked to send nude photos as a guarantee for their loans, just that they were afraid to speak up.

A reporter who posed as a potential client was able to gain enough evidence of the unconventional collaterals demanded by loan sharks. Besides the nude pictures, these private lenders also ask for various personal information, such as ID numbers, phone numbers, parent’s name, home address, student registration information, and even the roommates’ contact info. The report said that if you can’t make your payment on time, you are threatened that all of these details will be made public.

Pay attention to your safety and confidentiality

Experts advise Aussies in need of a loan to give special attention to the lender they choose. Loan sharks are very common nowadays, and their slyness can be extremely dangerous, especially for those who have little knowledge about the financial field.

If you don’t figure out things in time, you may get in real trouble, from paying exorbitant amounts of money to being blackmailed. Also, you may come across identity thief.

A safe way to borrow money is to opt only for reputable institutions, such as big banks or trusted non-bank lenders. When it comes to your safety and confidentiality, it is better not to take any risks.

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