The Office of Fair Trading is warning debt collectors not to pursue people who owe them money on social networking sites such as Twitter and Facebook.
It is concerned that embarrassing details about their financial problems will be revealed on the internet.
The OFT received complaints from debtors who were being pressurised online to pay off loans.
The regulator says it could strip perpetrators of their consumer credit licences to deter the practice.
'Vulnerable' online
The Office of Fair Trading has published updated debt collection guidance.
It sets out the standards expected of debt collectors, banks, law firms and any business associated with debt recovery.
David Fisher, the OFT's director of consumer credit, said: "In the present economic climate, with many people, including those who may be particularly vulnerable, in financial difficulties, it is crucial they are treated fairly by companies recovering their debts."
It is particularly worried because of the public nature of websites such as Twitter and Facebook, where friends and business contacts can sometimes see messages being sent to an individual.
A previous tactic of lenders, debt collection agencies and firms who buy up debts was to put cards through the letterbox or leave phone messages which might be picked up by other family members.
Some firms view the internet as the next place to look.
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