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Important news
在线翻译:
szdaily -> Important news
P2P lending growth slows under new rules
    2017-September-7  08:53    Shenzhen Daily

FOLLOWING tightened supervision by regulators, five peer-to-peer (P2P) lending platforms in Shenzhen suspended operation in August, sznew.com reported.

Both P2P lending transaction volume and loan balance declined in August compared with July, though the average rate of return on P2P lending platforms saw a minor increase and the average term of borrowing was slightly longer.

The average rate of return on Shenzhen’s P2P platforms was 9.29 percent, up 0.21 percent from the previous month. The average term of borrowing according to the standard released by Shenzhen’s P2P lending platforms was 6.47 months, 0.21 month longer than that of July, according to statistics from Rong360.com, a search platform offering financial services.

However, the average rate of return on Shenzhen’s P2P lending industry is lower than the national level, and the average term of borrowing is also shorter.

It is worth noting that two platforms have obtained A-round venture capital financing, namely, www.msyidai.com and ccfax.cn. The former received 400 million yuan (US$61 million) in financing from China Fellow Partners, while the latter won the financing of China Asset Management Co. Ltd., but the exact amount of the financing has not yet been publicly disclosed.

Insiders from the banking industry said that flexibility and rate of return are the major advantages of P2P compared with traditional financial institutions like banks. In the face of fierce competition, small and medium-sized banks began to seek cooperation with P2P lending platforms and sold the platforms’ products at their direct banks.

Instances of small and medium-sized banks offering fund depository business to P2P platforms are also steadily progressing. There are 1,245 P2P lending institutions that have direct fund depository business with banks, among which 574 are in operation.

As an important part of the Internet financial industry, the development of P2P has experienced wild and chaotic growth in recent years. The supervision of P2P lending platforms has tightened since May this year. Tougher rules and regulations have been issued to crack down on illegal financing and the established platforms have been forced to straighten out their business.

In such a strict regulatory environment, the transaction volume of Shenzhen’s P2P lending platforms in August declined to 36.847 billion, a 7.93-percent drop from previous month. By the end of August, the loan balance of Shenzhen’s P2P lending platforms was 122.263 billion yuan, reduced by 7.69 percent compared to July.

At the end of August, a cumulative 278 platforms were operating normally in Shenzhen. Additionally, Shenzhen-based Hongling Capital, one of the largest P2P lending platforms in the country, with a cumulative transaction volume of nearly 300 billion yuan, announced it will exit the P2P lending industry in the next three years. (Zhang Yu)

 

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