A total of nine provinces in China have placed bans on online peer-to-peer (P2P) lending operations by platforms in their jurisdictions, following a heavy crackdown which as brought the sector to its knees.
These nine province-level administrative entities include:
- Shandong province
- Hunan province
- Sichuan province
- Chongqing municipality
- Henan province
- Hebei province
- Yunnan province
- Gansu province
- Shanxi province.
Shanxi is the latest Chinese province to put the kibosh on P2P lending activities within its borders, issuing a directive in early January calling for all P2P platforms within its jurisdiction to complete “benign withdrawal” before the end of June 2020.
2019 was a dismal year for China’s P2P sector, which has all but capsized in the wake of intensified pressure from regulators.
The number of P2P platforms operating normally in China has dropped from over 7,000 to under 600 since the start of 2019, with regulators pushing for a total overhaul of the sector following reports of endemic fraud.