China’s aging population is rapidly advancing, with the number of people over 60 surpassing 310 million. The so-called “silver economy” with an annual output value of up to 7 trillion yuan is highly anticipated. However, the elderly consumer market is fraught with challenges, including scams in health products, traps in low-cost travel, and pitfalls in live streaming financial management. The main reasons behind these issues are attributed to the lack of regulation and insufficient legal protection.
The silver economy refers to the consumption power of the elderly. In 2024, China’s population of people over 60 reached 310 million, accounting for 22.1% of the total population. According to the official “Silver Economy Blue Book: China Silver Economy Development Report (2024),” the annual output value of China’s silver economy reaches up to 7 trillion yuan.
However, a recent article on Juhang.com pointed out that the elderly consumer market has become a hotspot for deception and fraud, turning the “silver economy” into a “senior scam economy.” The question arises, where exactly lies the core issues?
According to the China Consumers Association, disputes related to elderly consumer rights have been on the rise in recent years, with health products, travel, and financial products becoming hotspots for complaints. Many elderly individuals are lured into buying overpriced but ineffective “anti-aging products” or participating in sales gimmicks like “rebate health classes” or “free medical consultations with mandatory purchases.”
In May of this year, the Shanghai Market Supervision reported a typical case of scam involving more than 30,000 elderly people being defrauded of over 1 billion yuan through the sale of purported health liquor. Such scams entice participants with minor benefits to engage in their sales pitches.
One victim, Mr. Chen, influenced by the atmosphere of impulsive consumption, ended up purchasing over 10,000 yuan worth of health liquor and other health products with his wife. Mr. Chen mentioned that many elderly individuals like themselves have fallen victim to deceitful claims of miraculous health products, with some losing over one hundred thousand yuan in pension funds.
Regarding travel, the “2023-2024 Annual Report on Domestic Tourism Development in China” revealed that over 60% of elderly travelers aged 60 and above choose low-cost tours priced under 200 yuan, often involving compulsory shopping schedules and reduced accommodation and food quality, commonly known as “iron-bottom tours.”
In March this year, Ms. Zhang filed a complaint with the Southern Plus Help team, revealing her experience of being conned by a cheap travel tour. For a fee of 500 yuan, she signed up for a four-day-three-night trip to Hong Kong and Macau, only to end up spending thousands more due to disorganized itineraries and forced visits to unlicensed shopping establishments.
Searches on mainland platforms like Xiaohongshu for keywords such as “Zhongshan jade scam” and “scammed by low-cost tour groups” reveal numerous netizens sharing their or acquaintances’ experiences of being scammed.
In the investment field, some elderly individuals are drawn to “high-yield, low-risk” financial products. A case in point was the collapse of Shudai E-commerce platform in Shandong earlier this year, deceiving thousands of older investors with promises of cashback auctions, resulting in substantial losses, primarily among retired individuals.
Moreover, various forms of “investment and financial management courses” have become tailored methods of exploitation for the elderly. Online platforms are flooded with offerings of “financial courses” aimed at the older demographic, enticing consumers with low-cost or free “beginner camps,” often led by tutors with false financial investment experiences, using tactics like promising “financial freedom” to lure purchase of expensive courses.
Complaints related to “financial courses” on the Black Cat Complaints platform numbered over two thousand, with a significant portion involving the elderly. Complainants highlighted how they were misled under the guise of free courses, with the majority of group members being imposters.
With the rise of short videos and live streaming platforms, fraudulent practices have evolved alongside. Offering content like “expert health talks,” “live consultations by renowned doctors,” and “antique appraisal auctions” are prevalent on platforms where elderly users gather. Reports from mainland China in 2024 disclosed over ten thousand cases of live streaming fraud scams, with a significant 43% of victims being elderly individuals.
These swindling schemes are specifically tailored for the elderly, manipulating their anxieties around health and aging, establishing trust through “one-on-one customer service,” ultimately leading to high-value transactions or investments through coercion.
Critics have labeled the silver economy as a “senior scam economy.” Professor Sun Guoxiang from the Department of International Affairs and Business at Nanhua University in Taiwan analyzed the multifaceted reasons behind this phenomenon.
“Firstly, the lack of robust regulation and inadequate legal protection contribute to the prevalence of false advertising and deceptive sales tactics targeting the elderly. The lack of effective legal consequences allows unscrupulous businesses to thrive.”
“Secondly, in the context of China’s slowing economic growth and insufficient domestic demand, the development of the silver consumption market has become a policy priority, resulting in an influx of resources without establishing sound market orders and integrity mechanisms.”
“Furthermore, we observe a lag in consumer education and information asymmetry among the elderly. Many lack understanding of technology products and financial tools, making them susceptible to deception through emotional or health anxiety marketing strategies.”
“Lastly, there is a systemic expansion of moral risks, as some enterprises collude with grassroots social governance structures, such as allowing or tacitly endorsing health seminars in communities, leading to the elderlies’ fall into sales traps.”
Nevertheless, the issue of aging before wealth is not unique to China. Professor Sun mentioned that China faces a more severe elderly problem, which hence signifies distinctive characteristics of Chinese society.
He emphasized, “There is a significant wealth gap in social security income for the elderly in China, a current severe social issue.”
According to the “Fifth China Urban-Rural Elderly Living Conditions Sample Survey 2024,” the annual per capita income for elderly individuals in China is 32,027 yuan, with a median of only 11,400 yuan, showcasing vast differences between urban and rural areas.
“Substantial disparities in financial capabilities among local governments in China lead to varying levels of retirement pension assurance. While some public sector employees and state-owned enterprise retirees enjoy favorable treatments, ordinary urban residents and flexible workers may have insufficient social security contributions, resulting in only meager pensions or complete reliance on family support.”
Official figures revealed that in 2023, the average monthly pension for retirees in Beijing had reached 6,028 yuan, breaking 6,300 yuan after adjustments in 2024. It is projected that by 2025, the average monthly pension for retired individuals in Beijing could reach 6,600-6,800 yuan.
Economist Lu Ting previously pointed out that only 7% of the elderly population achieves this level of pension, with the average monthly pension for retiree employees in the middle stratum hovering around 2,000 yuan monthly, comprising about 38% of the cohort. This leaves nearly 60% in a state of extreme poverty.
“Therefore, the primary crisis faced by the elderly population revolves around economic challenges, with a significant portion lacking adequate retirement pensions or social security income, forcing them to rely on their children or part-time work for sustenance.”
Moreover, Professor Sun highlighted how China’s previous one-child policy led to a surge in the elderly population ratio, while lagging developments in the pension system, especially in China’s rural areas, hinder providing adequate care for the expanding elderly population and the heavy reliance on elderly family care. However, with the diminishing traditional family structures, children find it burdensome to assume full caregiving responsibilities.
He noted, “Due to work and residential constraints, children are unable to provide daily care for elderly parents, leading the elderly population to heavily rely on external information and services, enhancing their susceptibility to exploitation.”
“Elderly individuals also experience psychological and social isolation, particularly the rise in the proportion of elderly singles or empty-nesters leads to increased feelings of depression, anxiety, and a lack of security,” he added.
“The digital gap and technology alienation present additional challenges for the elderly. While smart society developments progress swiftly, elderly individuals find it challenging to adapt to these new technologies, making daily life more difficult. Tasks such as medical appointments, payment systems, transportation require digital proficiency in mainland China, thus increasing risks of exploitation. Elderly individuals lack anti-fraud capabilities, making them easier targets for scams related to financial management, health care, travel, and insurance.”
As a result, many elderly individuals opt for budget travel packages despite unfavorable conditions but are willing to splurge on substandard goods at shopping destinations. This phenomenon of “being reluctant to spend wisely but often wasting money unnecessarily” is prevalent in low-cost tours and live streaming scams.
The term “silver economy” originated in Japan, where the aging population ratio is even higher, surpassing 30%. The silver industry there has matured significantly.
The Japanese government has established consumer protection mechanisms for the elderly, such as the “Elderly Consumer Protection Law,” setting up hotlines for complaints, legal aid systems, and imposing strict prohibitions on telephone and door-to-door sales.
Moreover, Japan’s “Healthy Silver Industry” places importance on services and safeguards, featuring government-regulated certifications and labels for products specifically catering to the elderly, providing users with more participation and selection opportunities.
Comparatively speaking, in terms of national governance, Professor Sun suggests that mainland China still lacks robust legal consequences and suffers from regulation deficiencies and inadequate legal protection. In reality, this can exacerbate a social crisis of trust, as a lack of just resolutions for elderly individuals repeatedly victimized by fraudsters could damage the overall rule of law and public trust in the mainland Chinese government.