Research On The Legal System Of The Network Lending Platform

In july2007,our Country’s first Network lending platform—‘Pai Pai Dai’ wasestablished and formally operated in Shanghai. Then other lending platform such as‘Yi Xin’、‘Hong ling chuang tou’ were also established and operated. Network lendingplatform is a new type of financial model, breaking through the time and the regionalrestrictions, expanding the scope of the folk lending, solving the middle and smalltype of enterprise and individual’s financing problem, flourishing our credit market.The Network lending platform’s operation is neither macro, also not lending, onlyprovides financing place for parties and use tendering and bidding way to borrow andlend. In its business in nature, The Network lending platform is a quasi financialinstitution that providing financial service. But, due to the starting development of theNetwork lending platform and our Country’s credit system, the problem acting thedevelopment of the Network lending platform, such as breaching, illegalappropriation, illegal funding-raising and the use of loans can’t control, etc. So, inorder to reduce the platform’s financial risk and make it develop healthily, it isnecessary to establish regulation subject, draw up legal provisions and put it intofinancial supervision.This paper is divided into six parts.The first part: Introduction. This part will introduce the Network lendingplatform’s background of rising, status, influence, the financial risk and theconclusion of supervision. This part also introduces the article’s innovation.The second part: The Network lending platform’s overview. Firstly, it introduceThe Network lending platform’ meaning. According to comparatively analyzing,summarize the meaning. Secondly, it introduces the platform’s characteristic. In orderto summarize the platform’s characteristic, the author compare the platform betweenthe Network lending platform and other parties such as bank and Folk financingorganization. Thirdly, it introduces the platform’s legal nature. Through analyzing, theauthor considers the platform has qusi-financial organization’s nature and BrokerageContract’s nature, but according to the public interests inspection, we shoulddetermine its nature as qusi-financial organization.The third part: The study of the foreign network lending platform. The authoradopt the measure of inductive analysis to study the development of the foreign lending platform.The forth part: The platform’s current situation and the analysis of the Networklending platform’s legal issues. Firstly, introduces the platform’s current situation.Then, it will introduce the legal issues. The issues include:1. the lender’s legalposition isn’t clear.2. Network lending platform’s credit risk evaluation is not perfect,including personal credit system is not perfect and the credit evaluation mechanism isnot perfect.3. The Network lending platform can’t control the bad loan riskeffectively. Recently, the way of controlling bad loan risk is behind and single, onlyincluding audit and collection, but it can’t control the risk effectively.4. The Networklending platform is lack of regulation, including the necessity of supervising, theregulator is not clear and there is no regulation and laws to supervise.The fifth part: The Network lending platform’s legal regulations.1. Clear thelender’s legal status and rights and obligations.2. Compete the credit risk lendingevaluation system of the Network lending platform, including set up a perfectpersonal credit information system and establish basis credit rating system.3. Increasethe effort to control the risk of bad loans of Network lending platform.4. Set up thelegal supervision system of the Network lending platform, including establishregulator and draw up the law.The sixth part: Epilogue. This part is aim at sum up the author’s viewpoint.