Hong Kong authorities are proposing tougher rules for the city’s moneylending sector as part of a broader effort to curb aggressive debt collection tactics and protect borrowers from harassment.

The government has launched a public consultation on measures aimed at strengthening regulation of licensed money lenders and improving oversight of unsecured personal loans.

Officials say the initiative is designed to encourage more responsible lending practices while addressing growing concerns about abusive collection methods.

Among the proposed changes are tighter controls on how much individuals can borrow relative to their income, including the possibility of limits based on overall debt levels or caps on the share of income used to repay loans.

Authorities say the measures are intended to prevent excessive borrowing and reduce the risk of vulnerable individuals falling into cycles of debt.

The proposals also target the widespread use of loan “referees,” individuals whose names and contact details are provided by borrowers when applying for credit.

In practice, debt collectors sometimes contact these referees to pressure them into locating or persuading the borrower to repay debts.

Officials are considering restrictions on the use of referees, including a possible ban in some cases, to prevent harassment of third parties.

Government officials say enhanced affordability checks and stricter verification procedures could also be introduced to ensure borrowers clearly understand loan obligations before agreements are finalized.

Additional steps under consideration include improving complaint-handling mechanisms and strengthening public education campaigns on responsible borrowing.

The review comes after authorities recorded hundreds of complaints about moneylenders and debt collection practices in recent years.

Investigations have led to inspections, warning letters and referrals to law enforcement in cases where suspected violations were identified.

Under existing licensing conditions, lenders and debt collectors are already required to recover debts only from the borrower and must not harass unrelated individuals while attempting to locate debtors.

Violations of these conditions can lead to fines, imprisonment or the revocation of a moneylender’s licence.

The consultation reflects wider concern about the impact of high-interest loans and aggressive collection methods on vulnerable groups, including migrant domestic workers and low-income residents.

Authorities say reforms are intended to strengthen safeguards while preserving legitimate access to credit in Hong Kong’s financial system.

Public feedback on the proposals will be collected over the coming months before the government decides whether to introduce legislative or regulatory changes to the city’s moneylending framework.