At least six bike rental companies in China has shuttered during the last five months. After Bluegogo and Coolqi, the latest to close shop was Xiaoming (小鸣) which followed a similar scenario. Staff is claiming that the company’s controller Deng Yonghao has misappropriated funds and is nowhere to be seen. The company’s CEO Kai Lushi has already left and workers are waiting for wages since September. Reports state 99% of them have been laid off.

The bike rental industry is facing a bitterly cold winter and users are worried what will happen to their deposits. Estimates published in August put total deposits for rental bikes at RMB 10 billion, according to data from the China Internet Network Information Center. There is now a higher number of complaints connected to bike rental deposits than e-commerce disputes. Although the first national guidelines were issued in August there are no clear requirements regulating deposit returns, Xinhua has reported.

Former CEO of Coolqi Gao Weiwei has suggested that the price of their bikes (RMB 650) will be enough to cover the cost of user deposits (RMB 298)

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Masha Borak

Masha Borak is a technology reporter based in Beijing. Write to her at masha.borak [at] technode.com. Pitches with the word "disruptive" will be ignored. Read a good book - learn some more adjectives.