When a gang of debt collectors showed up to harass his mother, Yu Huan watched helplessly as they pushed her head into a toilet and sexually insulted her. After police refused to intervene, he grabbed a knife and stabbed wildly at the attackers, killing one and injuring three.

The 23-year-old’s life sentence for “intentional injury”, equivalent to second-degree murder, handed down by a court in Shandong province this month, has outraged the Chinese public at a time of growing defaults on debt — and heavy-handed tactics in recovering it.

In times of fast economic growth, China’s entrepreneurs relied heavily on high-interest loans to expand. Now, faced with defaults after several years of slowing growth and rampant overcapacity, loan sharks are turning to local thugs to collect. The results can be ugly.