On the days leading up to the Lunar New Year every year, the activities of black credit institutions are described by state-controlled media as very vibrant, especially in export processing zones with many factories. Accordingly, employees of illegal credit institutions are often on duty day and night to lend money quickly to workers who need money to go home to celebrate Tet.
Lao Dong Newspaper on January 20 reported with the headline “Black credit must be wiped out to establish social order and people can live in peace.”
The news said that people were very excited when there was continuous news that police forces across the country were cracking down on black credit gangs.
Accordingly, the police of Di An city, Binh Duong province, have just destroyed a group of subjects engaged in black credit activities, lending interest rates up to 365%/year. Previously, Ho Chi Minh City Police destroyed 24 gangs and 64 subjects involved in “black credit” activities…
The black credit system provides loans without collateral, always associated with debt collection, causing instability in society. Debt collection thugs will do everything, from psychological terror, throwing dirty things into the house, and even using force. This debt collection has resulted in many cases of bloodshed, injury, and even death.
Therefore, many people are in need, need money to spend, workers return home to celebrate Tet… just listen to the enticements of black credit groups and there is no way out. Debt upon debt never ends. Once caught in the trap of black credit, you will be a debtor for the rest of your life.
It is known that the closer Tet is, the more workers need money, so it is easy to get caught in the black credit trap. Although the loan interest rate is very high, up to 400-500%/year, many workers still have to grit their teeth and accept the loan to return home to reunite with family, or send money as gifts to relatives at home during Tet.
Some workers that the thoibao.de reporter had the opportunity to contact said that this is a situation that happens every year, and this year it is even worse, when life is more difficult, wages do not increase but prices increase higher.
A female worker working in an export processing zone in Binh Duong province said:
“Most of us workers borrow money to ‘spend first, pay later’ for Tet. We have to borrow a sum of money from them to spend during Tet, and then, after Tet, we receive a salary and bonus, then pay them back, but we have to pay them with high interest.”
It is known that in recent years, a form of lending called “online peer-to-peer lending” has appeared in Vietnam. In this form, businesses attract money from investors, then connect with the party needing to borrow money, which is a person or small business, through a website, or transaction application platform, without going through bank.
Vietnam’s state-controlled media said that of the 40 peer-to-peer lending companies operating in Vietnam, up to 10 companies originate from China. Economic experts evaluate: “It is a variation of black credit, which is a type of lending with very high interest rates and exorbitant interest rates. Nominally, they lend at low interest rates, but adding up all the costs, the interest rate can be up to 400%, 500%, even 700%, 800%, above for 1 year.”
This form of peer-to-peer credit lending has the advantage of saving time and costs, meeting the need for hot loans without collateral. Just need to have identification documents, household registration, latest monthly electricity bill, call the phone number at the electric poles on the sidewalk, people who need to borrow money can get money within 15 minute.
In 2019, an international news agency learned about this form of lending in China, saying that this form began to explode in China in 2011, and fell into an uncontrolled situation in 2015. Since 2015, China has controlled and tightened these activities. Since then, these Chinese companies have flocked to Southeast Asian countries, including Vietnam.
Currently, banks have many forms of lending, such as unsecured loans, mortgage loans, consumer loans, home loans, car loans… But banks all require borrowers to clearly state the purpose of the loan; must prove that they have a stable income; must have collateral… Not to mention, the approval time can be long.
Meanwhile, for many workers, they cannot meet the conditions offered by the bank. Meanwhile, money for medical treatment, tuition, rent… are all basic and urgent needs. Therefore, they have no choice but to rely on black credit.
The number of people who need to borrow money without collateral documents in Vietnam is currently very large. They are willing to accept loans with high interest rates to solve immediate difficulties. But interest rates can be so high that, if they cannot repay, the borrower has no choice but to flee the country.
Public opinions say that the police need to take action to prevent and destroy gangsters who giving loans in the name of credit, but are actually lending organizations with exorbitant interest rates, causing borrowers to be cornered to the end. This is a very urgent need./.
Tra My – Thoibao.de
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China-led illegal lending vibrant in Vietnam
Gangsters led by Chinese people offer loans in the name of credit, but are actually lending organizations with exorbitant interest rates, forcing borrowers into a corner.
#Vietnam #TinDungDenChina #Thoibao
