| As the increasing scale of Internet Finance in China, P2P expands rapidly. P2P take advantage of financial information on the Internet to provide money for individual and mircro-enterprises. According to data from Wangdaizhijia, a website reports more details, P2P showed a drastic development in 2014 and the number of platforms reached 1500 by 2014. The total amount of transactions is roughly equal to 38.29 million RMB. P2P makes up single method of loan in conventional fields and offers an opportunity for small firms.In reality, regulations in P2P are not sufficient to support the huge scale because of limit time in developing period and vague definition in legal rules. Multiple risks restrict further promotion of the entire field. By the way, under pressure, operators have difficulties to pay back and such actions invade investors’rights. Indeed, it is critical to complete related laws in P2P.The article starts from the legal nature of P2P and figures out legal shortages in this field by analyzing concepts, character and situations in modern life. After combing aboard experience, author lists several suggestions to perfect legal regulations associated with conditions in China.Researcher defines P2P as an abnormal financial institute. Chinese Banking Regulatory Commission should be the subject and local governments have the responsibility to cooperate with CBRC. Operators should register their platforms in CBRC as an entry requirement. Besides, CBRC should request professional skills of management such as major and working experience. The final step, regulators should standardize P2P platform exit mechanism. When the non-performing loan ratio reaches a certain level, the supervising bureaus is authorized to force that platform exiting the market, and bankruptcy protocol thereby engages the platform and protects the interests of consumers. Moreover, in the process of operation of a P2P online debit and loan platform, strict controls of capital flowing, and encouragement of trust of capital by commercial Banks are also suggested to prevent the funds from precipitation. |
