Female college students in China are being coerced into sending nude photos while holding up their IDs as collateral to loan sharks online in order to pay for tuition, Chinese state media reports, according to the Guardian.
By sending these images, female loanees qualify for loans two to five times greater than otherwise available.
But then comes the unthinkable catch: Should a woman fail to pay back the loan replete with the outlandish interest rates, the loan sharks threaten to disseminate the naked photographs online.
One female entrepreneur borrowed 120,000 yuan, or $18,228, in order to start a business. She sent nude photos as collateral and within four months, her loan had increased twofold, Beijing Youth Daily revealed, according to Vice. The woman was forced to turn to her family for help with repayment.
"The democratization of finance in China via peer-to-peer lenders and the vast shadow banking system, with interest rates sometimes topping 30%, have proved an inflammatory mix and fueled a surge in souring loans," the Financial Times explains.
Jiedaibao meanwhile seems to have been misleading the world about its practices. The Guardian initially reported the company said it was eager to work with law enforcement to quell such practices. "This kind of naked loan is actually taking advantage of the online platform to operate an illegal usurious offline business," Jiedaibao told the publication.
However, the Financial Times published their own coverage hours later, in which the P2P company said they were not complicit: "This is an illegal offline trade between victims and lenders who did it by making use of the platform."