The number of bank-run P2P platforms operating in China despite the natural advantages that established lenders have brought to Fintech business.
Securities Daily reports that the number of banking sector P2P platforms has fallen from a peak of nearly 20 to just six at present, including Lufax, Minsheng Yidai, ERong EDai, Kaixin Financial, Jinkaidai and Youyang Jinrong.
Bank-run P2P platforms have seen flourishing growth in recent years on the back of the natural advantages that established lenders possess when it comes to the operation of Finech platforms.
The “2016 China Online Finance Hotspot Research Survey Report” (2016中国互联网金融热点研究调查报告) released by the China Financial Certification Authority (中国金融认证中心) indicates that bank-run P2P platforms enjoy higher levels of customer satisfaction.
According to the report 85% of investors expressed satisfaction with banking sector P2P platforms, while over 90% of investors said that they would recommend such platforms if asked.
51.4% of people surveyed said that they would increase their investment share in banking sector platforms in future, while 42.1% said that they would reduce their investment in non-bank platforms.
Despite this success, many Chinese banks have gradually withdrawn from online lending sector over the past two years, bringing the total number of bank-run P2P platforms from close to twenty down to just six leading stalwarts.
Lufax is the undisputed leader when it comes to bank-run P2P platforms, as well as the largest P2P player in China and third largest in the world.
The credit screening infrastructure and vast data resources of 44% owner Ping An Insurance Group has no doubt abetted its tremendous success within China.
As of 31 December 2016 Lufax had 28.38 million registered users, for year-on-year growth of 55%, as well as 7.4 million active investor, for a year-on-year increase of 103.9%. The scale of assets under management by the platform was 438.379 billion as of the end of last year.
Lufax also has overseas ambitions, establishing an international trading platform in the ASEAN financial hub of Singapore.
Minsheng Yidai is another stalwart of China’s bank-run P2P scene, facilitating a total of 400 million yuan of investment as of August this year, with a comparatively high per capita investment amount of nearly 100,000 yuan.
Its association with commercial lender China Minsheng Bank gives it access to established risk-control standards, with the company’s official website claiming that there have been no defaults on any of its financial products, delivering investors returns of nearly 1 billion yuan over a three year period.
China Development Bank’s Kaixin Financial is considerable one of the more stable P2P platforms operating in the country, while also delivering higher returns than the annualised average of around 5% for banking sector P2P’s.
Its Jinpuhui DK171016084702 product, for example, has a term of 365 days and provides an expected annualised return of 6.7%.