KUALA LUMPUR: A seasoned loan shark has taken offence to being labelled inhumane.

"The problem is some of the borrowers deliberately refuse to pay, giving various excuses.

We give them reasonable time to repay. But when they continue to default on payment, we have little choice but to apply pressure to recover our money," said the loan shark who wanted to be known only as Jackie.

To compel repayment, Jackie said cash advances were secured through chattel mortgages or wage assignments. A chattel mortgage entitled the Ah Long to repossess household goods in case of default, while a wage assignment gave them access to the debtor's salary.

"There were some debtors who even pledged their bodies, or their wives and daughters, as collateral."

Jackie said use of force was a last resort as the loan sharks did not want to scare off their customers. "Without customers, we will be out of business. Each needs the other to survive."

He explained that loan sharks traditionally resorted to spray paint or writing out "O $ P $ (Owe money, pay money)" in red paint on the walls of the house of the debtor.

This was to threaten the debtor if he or she did not honour the debt.

"Another form of intimidation is to hang the head of a pig outside the defaulter's home or to display the debtor's identity card on a banner."

Another loan shark, identified only as Johnny, said loan sharks were known to have existed in the United States as early as the 19th century. Then, they were known as "land sharks" or "money sharks".

Johnny said the loan sharks would demand the bank ATM card of a debtor with the intention of withdrawing money for repayment once the debtor's salary was credited into the account.

"This way, the borrower can be entrapped eternally so that the repayment becomes an annuity," said Johnny, who claimed to be well-connected with the underworld and the powers that be.

As the cash advances were interest-only and required a lump-sum payment to retire the principal, many debts end up being dragged on for months or years.

As a solution, debtors often took another loan from a different loan shark to repay the earlier loan, thus ending up in further debt.

Johnny said a majority of his clients were those who could not get immediate loans from lenders like banks. "Many are short-term borrowers who just want a payday advance or credit for a postdated cheque for a month. As long as they repay their loans, there is no problem.

"But some, especially gamblers, get caught up in the system and are unable to make good their payments. That's when trouble starts."

He said although loan sharks were sympathetic to defaulters, money-lending was not a charity business.

"If you want to borrow money, make sure you repay. If not, keep out and live within your means."