Chinese students are being forced to take out ‘naked loans’

Dodgy Internet lenders have been offering money to female university students in exchange for nude photos

Female students in China are reportedly being forced by dodgy Internet lenders to exchange nude photos for financial aid.

The shady scheme – also known as ‘naked loans’ – sees lenders coerce cash-strapped students into sending photos of themselves without any clothes on. The images are then used as both bargaining and blackmailing tools; making the borrowers eligible for higher loan amounts, but also under constant threat of exposure if they don’t meet their payments on time.

According to the Beijing Youth Daily, the explicit photos – which must include visible identification – make students able to borrow up to five times the normal sum, with (often) extortionate interest rates. If they aren’t repaid on time, the images are reportedly leaked online.

The state-run paper goes on to explain the case of a so-called ‘Lin Xiao’, an anonymous woman from Jiangsu Province who fell victim to the service. According to the report, she borrowed 120,000 yuan (£12,873) from private lenders in February: a figure which ended up doubling within four months. She was apparently forced to seek help from her family to meet the repayments, and avoid having her photo leaked online.

The Southern Metropolis Daily also shared a similar story. It claims that, after initially only borrowing 500 yuan (£53) from an Internet lender, one student was left crippled by soaring interest rates; causing her debt to snowball to 55,000 yuan (£5892). She told the paper that the company demanded a nude photo of her as a guarantee to get new loans to cover the costs.

“If they borrow from banks there is no threat to personal safety. But if they borrowed from private lenders, especially high-interest lenders, it can happen,” bankruptcy lawyer Han Chuanhua of the Zhongzi Law told The Financial Times. “If they can’t repay sometimes the high-interest lender sends people to their homes. Mostly they threaten, but sometimes they take action. These types of people don’t go through legal channels.”

Jiedaibao, a P2P online lending platform accused of enabling these kinds of deals, denies any direct involvement. “This is an illegal offline trade between victims and lenders who did it by making use of the platform,” said a spokesperson for the company.