More and more Chinese businessmen have been struggling to pay back government loans due to the current economic slowdown. Now the government has taken some drastic steps in making borrowers pay up.
So far, 20 individuals the government dubbed as “dishonest,” have had their names, faces and other information posted on giant billboards. Details of the borrowers’ court cases, along with the owed amount, are seen flashing at major railway stations in Shanghai, according to the Telegraph. Unpaid loans as low as 1,984 yuan, or $300, can get a delinquent borrower’s name plastered on a huge billboard.
In July of last year, the same strategy was employed in the Anhui province where names and pictures of 30 debtors were made public. This caused at least one man to immediately pledge that he will return five million yuan, about $745,730, just a day after his named appeared on the billboard.
The shaming campaign also extended to other media sources like newspapers, television and the internet. Details of nearly 3.4 million Chinese borrowers have already been released, according to the Market Star newspaper.
In a press release sent to Reuters, Shanghai Railway Transport Court explained that, “It is an important initiative to deter dishonest debtors.” It also stated that some debtors changed their phone numbers and addresses before going into hiding after their names were released.
Beijing Institute of Technology Professor Hu Xingdou believes that such a practice is crossing the line:
“It is questionable whether it is appropriate to reveal this type of information to the public as it infringes on the right to privacy,” Xingdou told The Telegraph. “China’s economy is slowing down which caused a vicious circle. It is hard to make money, which makes it difficult for Chinese business people to return money.”
In China, where personal identity numbers or passports are required to purchase tickets for public transport and book hotels, the government has complete control in blocking some basic privileges.
China’s crackdown on debtors has resulted in thousands of individuals getting deprived and blocked from certain services such as private schooling for their children, booking hotels and leisure trips. Four million people have reportedly been banned from traveling by air, while almost a million people have been prevented from traveling via train for not settling their loans.