At any point of the digital transition,…
The age of P2P has finally ended.
At the “Caijing” Annual Meeting 2021 on November 27, Liu Fushou, chief lawyer of the China Banking Regulatory Commission, reported that the risks of Internet finance have dropped dramatically. Since the peak time the real operating P2P online lending institutions across the country have steadily declined from around 5,000. It will be fully zeroed by mid-November this year.
Online P2P lending institutions are cleared absolutely
2020 signals the end of the fight for the avoidance and resolution of financial risks and a very significant aspect of that is the unique rectification of shared financial risks.
The China Banking and Insurance Regulatory Commission has begun to report the success of P2P online lending institutions since the beginning of this year.
Guo Shuqing, Chairman of the China Banking and Insurance Regulatory Commission, reported in August that the real activity of online P2P lending institutions nationally has decreased from nearly 5,000 in the peak time to 29 at the end of June 2020, and the borrowing size and number of participants have decreased for 24 consecutive months.
In September, Feng Yan, deputy director of the China Banking and Insurance Regulatory Commission’s Inclusive Finance Branch, announced that there were 15 online lending institutions nationwide at the end of August 2020, down 99 percent from the beginning of 2019; loan balance decreased by 84 percent; lenders decreased by 88 percent; borrowing people decreased by 73 percent. For 26 consecutive months, the number of institutions, the size of the loans and the number of participants have decreased.
Liang Tao, Vice-President of the China Banking and Insurance Regulatory Commission, reported in October that the financial risk situation on the Internet had improved significantly and that the number of P2P online lending institutions currently operating around the country had decreased to six at the end of September and that the lending size and number of participants had decreased for 27 consecutive years.
Liu Fushou said on November 6 that the real activity of P2P online lending institutions across the nation has fallen from around 5,000 to the present three during the peak time. For 28 straight months, the borrowing scale and number of participants decreased.
Today, Liu Fushou announced that by mid-November this year the real activity of P2P online lending institutions nationally would be absolutely zero.
This announcement means that online P2P lending institutions are completely liquidated, and the era of P2P has finally ended.
The clearance of P2P does not impact
The legal obligations and liabilities of the parties to the loan arrangement
A number of online lending institutions from P2P have previously announced that the market balance of online lending has been cleared.
On November 10, Youwodai’s official website released an announcement announcing that youwodai voluntarily responded to the spirit of “three downs” regulatory. Under the supervisory rules, the balance of Youwodai’s P2P loans was cleared as of 10 November this year. The principal and anticipated revenue of all lending users has been redeemed, and the borrowing users’ redemption feature will continue to be preserved and will not be impacted.
Around the same time, several P2P online lending institutions’ inventory size that had been a smash hit continues to decline.
Ji Kui, Co-Chairman and CEO of Lufax, said before his birthday that the size was 160 billion yuan when Lufax ceased the P2P sector in August 2019. At the end of 2019, the figure had decreased to 100 billion yuan. The data fell to 48 billion Yuan at the end of June 2020. The stock value, so far is 30 billion yuan. At the end of the year, Lufax is preparing to minimize it to 20 billion yuan and this company will be almost gone next year.
It should be stressed, however that the complete settlement of the P2P online lending institutions would not change the legal rights and responsibilities of the parties to the loan arrangement.
The Office of the Jiangxi Province Online Lending Industry Leadership Group for the Avoidance and Settlement of Risks recently reported that the removal of online lending sites would not impact the legal rights and responsibilities of the parties who have signed loan contracts. The legitimate creditor-debt arrangement built on the online loan site between the lender and the borrower is covered by statute, and the borrower fulfills its repayment obligations in compliance with the law. It is possible to settle conflicts between lenders and online lending institutions, between lenders and borrowers, and between borrowers and online lending institutions through judicial means, such as self-reconciliation, arbitration and lawsuits. When an alleged illegal act is detected, it should be reported in compliance with the legislation to the relevant public safety body.
The notification released by the Beijing Internet Finance Industry Association on the start of a special rectification action on the “Nine Rich Inclusive” website for borrowers’ debt evasion claimed that it is in cooperation with the special rectification action of Fangshan to fight debt evasion and secure the legitimate rights and interests of lenders, the Beijing Internet Finance Industry Association and F.
Turn tiny lending businesses to find a way out
Several P2P online banking institutions have attempted to turn themselves into small loan businesses.
As early as November 2019, the Mutual Finance Remediation Office and the Online Loan Remediation Office released “Guiding Opinions on the Pilot Transformation of Online Lending Information Intermediaries into Microfinance Companies” The ‘Opinions’ suggested that it vigorously and gradually facilitates the clear adjustment of the financial risks of the Internet, directs those qualifying online lending institutions to turn into small loan firms, proactively reduces and fixes the current market risks of online lending institutions, minimizes the losses of lenders and facilitates generalization. Favorable financial laws have been established in an orderly way.
On October 18, the “Approval on the Transformation of Jiangxi Dongfang Rongxin Science and Technology Information Service Co., Ltd. (former Jiangxi Dongfang Rongxin Financial Information Service Co., Ltd.) into a pilot program for operating a small loan company nationwide.” was issued by the Jiangxi Provincial Local Financial Oversight and Administration Office.
Source: Website of Jiangxi Provincial Administration of Local Financial Supervision
The reply indicated that you comply with the National Mutual Finance Remediation Office and the National Online Loan Remediation Office (Remediation Office Letter  83 No.)’ Note on Printing and Circulating the Guiding Opinions on the Pilot Transformation of Online Lending Information Intermediaries into Small Loan Companies’ by your business in compliance with laws and regulations to turn
The Xiamen Local Financial Oversight and Administration Bureau decided to turn Xiamen Dolphin Financial Services Network Technology Co., Ltd. into a small loan firm based in a single regional region, Fujian Dolphin Financial Services Microfinance Co., Ltd. as early as May this year.
Fujian Dolphin Financial Services Microfinance Co., Ltd. strictly adheres to the ‘Guiding Opinions on the Pilot Transition of Internet Lending Intermediaries into Microfinance Firms’ (Renovation Office Han  No. 83) and ‘Administrative Initiatives for Microfinance Companies of Xiamen’ (Xiafu  No. 88) and other applicable regulations, working in compliance with the regulations laid down in the Regulations’