Record high loan defaults lead to millions 'Blacklisted' in China

Midst the ongoing economic struggles ex acerbated by the COVID-19 pandemic and Beijing’s stringent lockdowns, millions of Chinese borrowers find themselves blacklisted for failing to repay their debts, according to a report by the Voice of America (VOA).

The debt-related issues primarily afflict individuals between the ages of 18 and 59, reflecting the severe financial strain caused by the economic disruption. Zhang Congzhi, a businessman from Changsha, shared his plight with VOA, revealing that he initially borrowed money two or three years ago when online loans were readily available. However, with the economic downturn, Zhang finds himself unable to repay debts exceeding 100,000 yuan (approximately USD 13,700). His predicament exemplifies the growing indebted population in China as the economy grapples with recovery challenges and soaring unemployment rates.

The consequences of debt extend beyond financial burdens, as individuals blacklisted by authorities face significant obstacles in obtaining new loans. In some cases, they are even prohibited from working as civil servants, reflecting the broader impact on various aspects of their lives. These blacklisted individuals encounter restrictions on several economic activities, from using toll roads to purchasing airline tickets and making mobile payments.