Authorities to rectify online financial sector
Working plan proposed to help lift Chinese P2P firms out of trouble
Chinese authorities are beefing up efforts to regulate the financial internet sector to help stabilize a market that is witnessing the collapse of many peer-topeer (P2P) lenders, an expert said on Tuesday, adding that such efforts have been successful so far as troubled platforms are on the way to recovery.
A working plan for special regulations addressing online financial risks has been put forward by relevant authorities, and the work to rectify problematic P2P firms is expected to be completed by June 2019, domestic news site yicai.com reported on Monday.
The People’s Bank of China (PBC), the country’s central bank, said on Monday that Chinese authorities will spend one to two more years strengthening regulation on the online finance industry and establishing an industrial regulatory system.
Deputy PBC Governor Pan Gongsheng said that relevant departments will make efforts to build a long-term mechanism for online finance regulations and will ensure internet technology plays an active role in allocating financial resources, according to a statement posted on the PBC’s official website.
“An increasing number of small P2P platforms were found to have collapsed in recent days due to tight market liquidity, which has been affected by strict financial supervision and the plummeting stock market,” Wu Min, a Shenzhenbased industry analyst, told the Global Times on Tuesday.
As Chinese authorities said they would spend one to two more years advancing regulation on the sector, the industrial record-filing system is likely to be rolled out in the near future, Wu said.
Beijing and South China’s Guangdong Province each have 10 troubled P2P platforms, while there are 21 lenders with brewing problems in Shanghai, industry website wdzj.com reported on Monday.
Shenzhen-based P2P lending platform qian88.com on Monday halted operations as it failed to make repayments, with local police launching a probe into the firm shortly after, news.ifeng.com reported on Tuesday.
Transactions of P2P platforms in Beijing, Shanghai and Guangdong Province totaled around 129 billion yuan ($19.5 billion) as of June, down 4.17 billion yuan month-on-month, news site finance.cnr.cn reported on Monday.