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Record Number of Chinese Blacklisted for Debt Defaults – FT

The number of Chinese blacklisted for defaulting on debts has hit a record high, which means millions can be blocked from using mobile apps for payments

China may need to spend more on social services or cut outlays on other sectors to help lift consumption levels following the Covid-19 pandemic, which has made people more cautious on how they spend their money.
About 1% of working age adults in China have defaulted on debts, which limits their ability to access services and highlights the country's lack of personal bankruptcy laws to provide some debt relief. This image shows people walking on Nanjing Pedestrian Road in Shanghai (Reuters).


More than eight and a half million Chinese citizens are blacklisted by authorities because they defaulted on debts by missing payments on mortgages or loans, according to a report by the Financial Times, which cited local courts, saying the figure was a record high, up from 5.7 million citizens in early 2020 prior to the Covid pandemic and likely to make it hard to boost consumer confidence.

People who are blacklisted after defaulting on debts are blocked from buying plane tickets and making payments via mobile apps such as Alipay or WeChat Pay if they get sued by banks or creditors for missing a payment deadline, and can even be blocked from government jobs and using toll roads, it said, noting that household debt had doubled over the past decade to 64% of gross domestic product in September and many people were also struggling to find work. Legal experts have proposed introducing personal bankruptcy laws to provide debt relief for individuals but this has been stymied by a reluctance of state workers or other groups to disclose their assets because of fear it could reveal corruption.

Read the full report: The FT.




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Jim Pollard

Jim Pollard is an Australian journalist based in Thailand since 1999. He worked for News Ltd papers in Sydney, Perth, London and Melbourne before travelling through SE Asia in the late 90s. He was a senior editor at The Nation for 17+ years.


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