As more investors fell victims to P2P scams, the public started to question the credibility and prospects of China’s booming but still lightly regulated P2P lending industry. As of April this year, there are more than 700 P2P lending platforms in China, according to a report by financial news portal 01caijing. During 2011 to April 2014, at least 118 P2P lending sites, or 16% of the sampled platforms, have experienced different kinds of problems, like suspension of business for rectification, bank run, bankrupt, or even absconding of operation teams, the report added. Chinese search giant Baidu also took its own efforts to crack down the P2P lending frauds.

While P2P lending is haunted by fraud scandals, P2B (peer-to-business), a new online lending model derived from P2P, is catching the eyes of venture capitalists, with two P2B lending platforms announced new funding this week.

Licaifan, a P2B lending platform, announced eight-digit yuan of Series A financing from renowned private fund manager Lin Guangmao. According to the company, it has nearly 100K registered users with an annualized yield of over 12%. Another similar site Shicaidai raised nine-digit yuan in Series A financing from Water Spirit Co-investment Club. Both of the companies emphasized that the new funding will be injected in promoting their risk control abilities.

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Emma Lee

Emma Lee is Shanghai-based tech writer, covering startups and tech happenings in China and Asia in general. We are looking for stories related to tech and China. Reach her at lixin@technode.com.