The number of Chinese consumer loan arrears has soared
In China, banks and Internet lenders are trying to recover more and more overdue credit card arrears and personal loans. These institutions sometimes take aggressive measures to let borrowers repay their debts.
In January of this year, the new coronavirus epidemic began to spread in China. Many people were trapped in their homes for several months, experiencing salary cuts or unemployment, and the number of consumer loan arrears continued to increase. Since then, Chinese lenders have been working hard to deal with this situation. During the blockade of more than 10 weeks in Wuhan, a city in central China, some banks and online lenders have been unable to carry out debt collection efforts-Wuhan is home to many call centers.
Before this wave of economic downturn, as banks and online lenders competed for business during the economic boom, Chinese consumers' credit card debt, short-term loans, and mortgage and car loans reached record levels. In recent years, the popularity of smartphones and mobile applications has also made it easier for millions of people to obtain loans from online lenders . Many borrowers provide contact information for family and friends when applying for loans.