Europe did it back in the day. If you were a debtor you were thrown in debtors' prison until you paid off your debt... but you can't earn any money while you are in debtors' prison... Catch-22. I'm assuming that it's meant as a deterrent to try and prevent people from getting into debt in the first place. Not that it's a very good (or humane) idea though.
I imagine that loan sharks must just extort people for money by terrorizing them with physical violence much more often than they actually kill anyone. Otherwise their lending practices would cause them to lose money hand over fist.
