Source: Bloomberg (paywall)
China's absence of formal personal bankruptcy law has created a shadow debt-collection market affecting roughly one-seventh of the population. Debt agencies operate with minimal oversight, packaging and reselling bad debt as a financing asset class. Aggressive collection practices risk destabilizing consumer spending in an economy already facing growth headwinds. The fintech lending boom of the 2010s has outpaced enforcement infrastructure designed for an earlier era, exposing a gap between digital credit expansion and debt resolution capacity.