(Yicai Global) Nov. 29 -- Chinese rural  lenders are resorting to unconventional methods to lower their ratios of  defaulted loans.

Central China's Chenzhou Rural Commercial  Bank announced a peculiar report on their social media WeChat channel,  showing their recent successes in making individuals and company owners  repay their debts. 

"Please bring your cutlery, shoes and all  daily necessities!" said Zhou Songbai, the secretary of the bank's  party committee at a meeting with over 140 staff members on Oct. 15. "I  will go to the deadbeat's home and stay until the loan is settled." At  this point, Zhou's team from the bank had already sat put at one debtor  surnamed Hu's apartment and negotiated a repayment plan for more than  three hours, without success. 

The central government has tightened  banking rules this year to reduce state-owned banks' freewheeling  borrowing to commercial banks, and force lenders to expose their hidden  liabilities, which has put pressure particularly on rural commercial  banks. Lenders, such as Guiyang Rural Commercial Bank, Shandong Zouping  Rural Commercial Bank, and Tongling Rural Commercial Bank have logged  rapid increases in their non-performing loan ratios.

On the next day after the meeting, the  participants took to the streets, wearing bright uniforms and signs with  messages such as "Law Abides Debtors" and they collected cash from  borrowers in two districts of the city. During that day, they had  managed to garner a sum of CNY2.5 million (USD354,000). 

Hu, who had borrowed CNY600,000  (USD86,500) from the bank to start a clothing business, had failed to  pay back anything for about 18 months while the loan interest had grown  to CNY110,000. After two and a half hours of negotiation, he agreed to  sell his property to settle the loan by the end of the month. 

During the next four days of work, the  bank workers, who had slept at borrowers' houses, had accrued CNY142  million that contributed to almost 500 non-performing loans. 

Another bank in Shuyang county in Jiangsu  province used similar measures to urge a car company to repay its debt  of CNY1.4 million which had defaulted in May last year, Yicai Global's sister publication Yicai reported yesterday. After the clerks showed up at the gates of the auto firm, they received CNY106,000 during the same day. 

A rural commercial bank in Gaoping  country in northern China's Shanxi province had a particularly  persistent debtor surnamed Hou who refused to open the door to bank  employees once they came to demand the CNY90,000 (USD13,000) that Hou  had borrowed to buy a car. An account manager explained the consequences  of ruining a personal credit score and Hou agreed to return the whole  sum.

Some of the cases brought community  members closer together. Once some bank workers came to seek what  belongs to the lender at a small town in Jishui county in southeastern  Jiangxi province, they found an individual in bad health amid tight  financial conditions to support a family. The clerks designed a  reasonable repayment plan and donated CNY2,000 (USD288) on top of that. 

Another borrower said that the money had  gone to planting oranges but as sales channels were scarce, profits were  pending. The financial workers used their networks of people to help  sell the fruit and got the farmer out of trouble. 

Editor: Emmi Laine