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Subject: Only one out of the nine peer-to-peer lending companies in China might be able to survive as top financial regulators are stepping up the pace of…
Excerpt: English text from the archived bilingual edition · Chinese edition
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Only one out of the nine peer-to-peer lending companies in China might be able to survive as top financial regulators are stepping up the pace of scrutiny to curb risks caused by the massive unregulated sprawl in the past few years
The central government plans to maintain "pressing posture of severe attack" to clamp down on activities violating laws and regulations in internet finance, extending the ongoing nationwide crackdown for another year, Pan Gongsheng, deputy governor of the People's Bank of China, the central bank, said last Monday
The two-year cleanup of the industry was necessitated by a series of scandals that saw investors lose huge amounts of money
His comments echoed earlier remarks by Sun Guofeng, head of the research institute of the central bank, who warned that financial risks are now spreading from traditional sectors to the emerging fintech sector, increasing the risks associated with online cross-region loan operations
"Regulators at local levels should adopt new technology such as cloud computing to enhance capabilities in protecting against and resolving cross-market financial risks," he said
Many companies may find it hard to survive in the coming months amid the strong push to clean up the sector coupled with pressure from the recent liquidity crunch and an expected large amount of withdrawals
"The number of companies may shrink to only around 200 to 300," said an expert with a leading internet finance institute
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