Don't Miss

China's Online Lending Crackdown May See 70% of Businesses Close

Xinhua Financein Bloomberg
2019-01-03 14:26

Already collect

The number of Chinese peer-to-peer lenders may drop by 70 percent this year, a research firm that tracks the industry says, as the nation intensifies a crackdown on riskier forms of financing.
 
As few as 300 companies will remain by the end of the year, according to an estimate from Shanghai-based Yingcan Group. The number of operators dropped by more than 50 percent to 1,021 during 2018, it said, adding that there’s been no new entrants into the market since August.
 
Chinese leaders are dramatically shrinking a market that spawned the nation’s biggest Ponzi scheme, protests in major cities, and life-altering losses for thousands of savers. Authorities are planning to wind down small- and medium-sized P2P lending platforms nationwide, people with knowledge of the matter had earlier said.
 
Winter Is Coming
 

China's online peer-to-peer lending weakens as crackdown deepens
 

 
Sources: Rong360.com, Bloomberg
 
Yidai is the latest to exit the business. It has about 32,000 lenders with an outstanding principal balance of 4 billion yuan ($581 million), and expects to repay them within five years, Yidai said in statements in recent days.
 
Yidai, which received investment from SoftBank China Venture Capital in 2014, said it was affected by panic spreading among individual lenders that shrank transaction values and triggered defaults.
 
P2P platforms comprise one of the riskiest and least regulated slices of the shadow banking system in China. The lack of oversight has allowed for world-beating growth, with outstanding P2P loans ballooning from almost nothing in 2012 to 1.22 trillion yuan in December 2017.  

Source: Bloomberg
Add comments

Latest comments

Latest News
News Most Viewed