According to the Associated Press, the state-run Southern Metropolis Daily newspaper reported this week that private lenders in China have been asking for naked photos as collateral from female college students looking for a loan.
Copies of their ID cards were also demanded along with a warning that the photos would go public if payments were not made on time.
One of the borrowers spoke out to the newspaper, saying that many of her female classmates had also been caught in the scheme but didn’t want to speak up.
She said after first borrowing 500 yuan ($76) from an online loan provider with a weekly interest rate of 30%, she continued to take out new loans to pay off old ones, seeing her debt soar to 55,000 yuan ($8,347). Her lender then demanded a nude photo of her as a guarantee for new loans.
The newspaper said the woman was going to report the incident to police but one of their reporters went undercover as a potential client and obtained evidence of the loan sharks demanding naked photos by joining online chat groups frequented by lenders.
Personal information including phone numbers, ID numbers, home addresses, parents' names, contacts for roommates and student registration information, was also requested from borrowers, which the lenders threatened to make public should the borrower default, the report said.
The newspaper reported that after the story had been published, the lenders had suspended the practice.