Chinese investors in online peer-to-peer (P2P) lending platform PPMiao have staged protests at the Shanghai office of one of its key shareholders, as problems in the sector continue to intensify.
According to Reuters round 300 PPMiao investors forced their way into the lobby of the International Finance Centre (IFC) shopping mall in the Shanghai’s Lujiazui district, in order to protest the recent platform’s recent failure
IFC is home to the offices of HuaAn Future Asset, a key shareholder in PPMiao’s previous operator, Hangzhou Fuqian Network Technology.
PPMiao announced the suspension of operations on 6 August following failure by certain enterprise borrowers to make payments, and committed to returning funds to investors over a 36 month period.
According to its website PPMiao has 4.9 billion yuan in funds and around 360,000 users.
HuaAn, which is partially owned by local government companies including Shanghai Electric Group and Shanghai Trust, said in an official statement on Monday that it had never obtained profits from PPMiao,and had only registered as a Hangzhou Fuqian stakeholder on behalf of a client.
The events in Shanghai follow similar efforts by burnt P2P investors to stage protests in front of the headquarters of the China Banking and Insurance Regulatory Commission (CBIRC) in Beijing.
2018 has seen a rising number of P2P platform closures, with an marked acceleration since the start of the second half.
Data from Wangdai Zhijia (网贷之家) indicates that as of the end of June China had seen the establishment of 6183 P2P lending platforms, of which 4347 have either suspended operation or succumbed to problems, leaving only 1836 in regular operation.
Compared to November 2015, the peak period for P2P lending in China when the number of active platforms reached 3476, the number of platforms in regular operation has fallen by almost a half.
Beijing has since unveiled a slew of strategies to deal with problems in the sector, as well as placed a ban on the establishment of new platforms.