Off the wire
• Dollar changes hands in mid-100 yen range in early Tokyo trading  • New method of cancer immunotherapy developed  • Urgent: Colombian gov' t, FARC guerrillas reach peace agreement after 4 years of talks  • Four Iranian vessels intercept U.S. destroyer around Strait of Hormuz: media  • Experiment shows smartphone speech recognition 3x faster than typing  • Brazil's former FM slams gov't stance against Venezuela's turn at Mercosur  • U.S. house prices rise 1.2 percent in second quarter of 2016  • 2nd LD Writethru: DPRK top leader guides strategic submarine-launched ballistic missile  • Brazil sends condolences to Italy over earthquake  • Chicago agricultural commodities close lower on big harvest prospects  
You are here: 　 Home/ Government Policy

China tightens controls on P2P lending

Xinhua, August 25, 2016 Adjust font size:

China's banking watchdog issued a set of regulations on Wednesday, aiming to tighten supervision of the country's booming peer-to-peer (P2P) lending industry.

The document imposes a series of restrictions on P2P platforms, prohibiting them from accepting public deposits, pooling investors' money for their own projects, providing guarantees for lenders, or selling financial products, according to the China Banking Regulatory Commission's (CBRC) website.

P2P lending, lenders without a traditional financial intermediary such as a bank, has seen rapid growth in China in the past few years, as investors seek higher returns, and small businesses find it easier to secure funds through P2P platforms.

The lack of supervision, however, causes considerable risks. Fraud, fund flight and illegal fundraising are common, and some investors have been left out of pocket as many P2P platforms went bust.

At the end of June, there were 1,778 P2P lending platforms with operational problems, accounting for more than 40 percent of the total. Outstanding loans issued by P2P platforms has reached 621.3 billion yuan (about 93.6 billion U.S. dollars), according to CBRC data.