Many credit card holders, including this university student, agree banks should not reveal their information to other organizations or individuals. Ma Jian / For China Daily

BEIJING - Credit card holders are worried their privacy will be infringed as Chinese banks resort to third-party debt collectors to collect overdue amounts.

Zheng Xiaofeng, who failed to pay his credit card debt on time when he was away on business for long periods, said he was worried about the loss of his personal information when he received calls from a debt collector.

"There's no doubt that people should pay their debts on time, but it is not right for banks to turn over a delinquent account and personal information to a third party, which may disclose our personal data to others for illegal purposes," Zheng said.

Since Bank of China issued the first credit card in 1985, cards have ballooned in popularity, especially over the past decade.

By the end of June, China's banks have issued 207 million credit cards, up 27.4 percent year-on-year, statistics by the People's Bank of China (PBOC), the central bank, showed.

With the growing number of credit card holders, debts of overdrawn credit card owners have risen sharply.

In the first quarter of this year, the balance of credit card payments overdue for more than six months hit 8.8 billion yuan ($1.32 billion), an increase of 1.1 billion yuan or 14.4 percent over the previous quarter, the PBOC said.

Many Chinese banks have hired third-party collection agencies to reclaim the debts.

But many credit card holders said banks should not reveal their information to other organizations or individuals.

"I provided my personal information to the bank when I applied for a credit card, but I didn't expect them to give my personal data to another agency," said a man surnamed Luo, who forgot to pay his debt after he bought a computer using a credit card.

Even though Luo eventually paid off his debts, he felt his privacy had been violated.

The debt collectors, who are paid a percentage of what is collected, generally use "soft-violence", including harassment, intimidation and deception, to force defaulters into paying up, some said.

Wu Ming (not his real name), who overdrew his account by 50,000 yuan for a family emergency last year and failed to pay off the debts in four months, said he was harassed and threatened by a debt collector in Shenzhen.

Wu said two guys from a collection agency came to his house in October last year, threatening to imprison him and expose the debt to his family and friends if he didn't pay it off.

Wu moved to a hotel to live because he feared being kidnapped.

"At that time I was very worried about my family," Wu said. "The debt collectors said they knew where my child's school was."

Wu, who finally paid off his debts, has stopped using a credit card.

Wang Yuguo, general manager of Rong Lian Credit Card Service Company in Shenyang, capital of Liaoning province in Northeast China, said the reason for banks to outsource the collection is because a debt collection agency has enough time and staff to face the hard job of collecting outstanding bills.

"Too many unpaid debts can put pressure on the revenue stream, which compelled us to hire a third party who works on our behalf to collect the bills," Wang said.

"We have commissioned about five debt collectors which use proper means to do their jobs, so there's no need to worry about legal matters."

Qiu Baochang, director of the Consumer Rights Protection Committee of the Beijing Lawyers Association, said it is legal for a bank to commission an agent to reclaim a debt on its behalf, but it will violate individual's privacy right if the agencies revealed the debtors' information to others.

He said that by law, collection agencies are not permitted to make threats that can cause embarrassment or harm.

"Both banks and the third parties should take responsibilities if the defaulters' personal information is leaked," Qiu said.

"Banks have the legal right to collect debts, but it is also their responsibilities to protect their clients' privacy."

By Lu Chang