China’s peer-to-peer (P2P) lending industry is in turmoil. In recent months, authorities have ramped up regulatory oversight of the world’s largest P2P lending industry. Investors are losing confidence at their stakes and pulling their funds, diminishing operators’ liquidity; many of them are facing insolvency.

P2P lending, or online lending, is a popular fintech application under which intermediaries gather funds from retail investors and loan the money to small and medium-sized enterprises (SMEs) and individual borrowers. Since these services are almost entirely operated online, they promise higher returns to investment compared to financial products offered by traditional institutions.

Yingcan Group, a Shanghai-based research firm, estimates that half of China’s online P2P platforms disappeared in 2018. They expect 70% of those remaining to be out of business by the end of 2019. If this prediction is true, within the span of two years China’s P2P industry will have shrunk by 85%.

Start your free trial now.

Get instant access to all our premium content, archives, newsletters, and online community.

Monthly Membership

Yearly Membership

What you get

Full access to all premium content and our full archives

Members'-only newsletters

Preferential access and discounts to all TechNode events

Direct access to the TechNode newsroom

Start your free trial now.

Get instant access to all our premium content, archives, newsletters, and online community.

Monthly Membership

Yearly Membership

Nicole Jao

Nicole Jao is a reporter based in Beijing. She’s passionate about emerging trends, news, and stories of human interest within the world of technology. Connect with her on Twitter or via email: nicole.jao.iting@gmail.com.