Internet lending in China: Status quo, potential risks and regulatory options

Internet lending or P2P lending is excessively popular in China compared to other economies. However, this sector is still largely free from regulatory oversight. A consequence is that P2P platforms lack sufficient supervision and information disclosures and involve high-risk loan business with sometimes fraudulent activities. This article investigates China's growing P2P platforms and the dangers if this new form of lending is left unregulated. Regulators need to take a coordinated approach tackling potential risks endogenous in this sector.