Tencent-backed Mogujie shuts down its P2P lending platform

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Screenshot of Mogujie’s online lending platform Zhongdoubao. (Image credit: Nicole Jao / TechNode)

蘑菇街旗下P2P种豆宝清盘:停止发标 不再新增业务 – Sina Tech

What happened: Tencent-backed e-commerce company Mogujie, known as “China’s Pinterest,” has shut down its online lending platform, Zhongdoubao. According an announcement on the lending platform, the decision to end its brief foray into China’s tumultuous P2P space was “to fulfill regulatory requirements and ensure the security of funds.”

Zhongdoubao said the platform will remain operational until all repayments to lenders are completed.

Why it’s important: China’s P2P lending industry is undergoing massive turmoil in recent months as authorities ramp up oversight to clamp down on risky financial practices. Launched in April, the Hangzhou-based Zhongdoubao reported cumulative transaction volume totaled around RMB 78.1 million with RMB 7.1 million in loan balances as of February — small-scale loan figures relative to big platforms such as Lufax and Dianrong.

The Chinese government started rolling out measures to curtail small and medium-sized lending platforms in 2016. Industry experts expect the consolidation to continue throughout 2019.