Why is Hong Kong law soft on predatory lending and debtor harassment?
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The issue of
licensed moneylenders in Hong Kong engaging in illegal practices demands urgent attention. While some operate within legal boundaries, others exploit borrowers with
extortionate interest rates and coercive collection tactics, often skirting the law.
What is deeply concerning is how society and even the authorities appear to have normalised these practices to an extent reminiscent of Stockholm syndrome.
When lenders are not overtly harsh, their actions are often deemed acceptable, as if civility excuses illegality. This mindset must change – what is wrong is wrong, regardless of the lender's demeanour.
The Money Lenders Ordinance is outdated and ill-equipped to address current predatory practices.
Interest rates, sometimes effectively exceeding 48 per cent, trap borrowers in cycles of debt, particularly those in vulnerable situations who are not familiar with local lending practices. Many borrowers are willing to repay loans if terms are fair and collection methods lawful. Yet, the lack of stringent caps on interest rates and the weakness of enforcement against illegal practices enable exploitation to thrive.
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