Hong Kong to tighten moneylending rules to tackle debt collector harassment
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Hong Kong will implement stricter regulations for licensed moneylenders starting August 1st to combat debt collector harassment. The new rules, outlined by the Financial Services and the Treasury Bureau, include debt servicing ratio caps for low-income earners, limiting monthly repayments to 35% for those earning HK$6,000 or less and 40% for those earning between HK$6,001 and HK$12,000. The regulations also ban the use of loan referees. These measures aim to protect vulnerable groups, such as low-income earners and foreign domestic helpers, from excessive borrowing and subsequent harassment from debt collectors seeking unpaid loans. Lawmakers believe the changes will curb illicit lending practices, though some advocate for further industry regulation.
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AI-ExtractedThe government would roll out the regulatory measures in two phases to protect the public interest.
Monthly repayments for borrowers earning HK$6,000 or less would be capped at 35 per cent of their income.
Hong Kong will tighten moneylending rules starting in August.
Excessive borrowing had become particularly acute among low-income earners and foreign domestic helpers.
Lawmakers said the measures would help stop most illicit loans.
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