Chinese nationals and Hong Kong citizens using mainland credit cards could face jail time if they default on credit card debts three months after receiving a second warning notice, the South China Morning Post reported. The Supreme People’s Court and the Supreme People’s Procuratorate jointly issued the judicial explantaion as concerns grow over rising credit risks. Liability of Hong Kong residents using cards issued by mainland banks depends on whether the card was issued in the mainland or Hong Kong, and the extent of the liability specified in the contract. Cardholders in China were already subject to a law stating that "malicious overdraft" was a criminal offense, but this is the first time the penalties have been clarified. The People’s Bank of China earlier annouced that RMB7.42 billion (US$1.08 billion) in credit card debt was more than six months overdue in the third quarter.
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