A leading Chinese fintech company has been raided by police in the southern tech hub of Hangzhou.
Hangzhou police staged a raid of the Xihu district offices of 51 Credit Card on the afternoon of 21 October according to domestic media reports, before departing with both staff members and boxes of documents in tow.
Shares in the Hong Kong-listed online lender dropped by over 34% on the same date before being suspended from trading.
51 Credit Card subsequently announced that the company’s business operations and financial status remain normal.
Sun Haitao (孙海涛) founded 51 Credit Card in 2012 as a credit card management platform. The company listed on the Hong Kong Stock Exchange on 13 July 2018, overcoming initial concerns from investors about its revenue generation model.
As of the end of the second half the company’s registered users stood at 83.4 million, for a YoY rise of 21%, while credit cards under management increased by 16.9% compared to the same period last year to reach 138.7 million.
The 51 Credit Card raid coincided with the China Banking and Insurance Regulatory Commission’s (CBIRC) unveiling of plans to drive the conversion of P2P lenders into micro loan companies.
At a recent press conference CBIRC revealed that the P2P loan balance had dropped 48% as of the end of September compared to the start of the year, while more than 1,200 online lenders have suspended operations in 2019.