China Development Research Network Lending P2P

With the development of the Internet in the21st century, we ushered in a newWeb2.0era, which improved network coverage and paid more attention tointeractive use of Internet user. In this context, the innovative integration of Internetand modern financial business makes the P2P network lending platform came intobeing. P2P network lending platform pooling the small funds to lend to who needsthem through the Internet. The characteristics of P2P Lending are that lowthreshold, no mortgage, wide coverage, simple procedure, easy to meet theborrowers’ need. Based on these characteristics, P2P Lending fills the gap of formalfinance, enlarges the range of financial service, improves the efficiency of financialservice, and benefits more people.The new financial business is booming: it originated in UK in2005, namedZopa, then, Prosper, Lending club in the US, and nonprofit lending platform Kiva.This Inter-finance model was introduced into China in2007, PPdai network lendingplatform established in Shanghai, afterwards the P2P Lending business have beenpopping up in China. According to incomplete figures, there were more than300network lending companies. These companies are in small scale and most of themlocated in the well developed area, their service are limited in the companyregistration provinces. Our network lending businesses have innovation models incomparison with abroad ones, such as: offline P2P lending, credit assignment, creditguarantee, P2B, and P2P as part of large financial group. For sure, these modelshave both advantages and disadvantages. This paper attempts to reveal the reason ofP2P Lending business thriving from three aspects: relevant theories, development ofInternet technology, and predominance of P2P lending. This thesis accounted PPdai’strading records in2013, according to the statistical analysis, it can be drawn theindications of borrowers’ features: young and middle-aged men in the eastern coastaldeveloped areas, wage-earners and private business owners. The finding by the analysis on the order is that: no mortgage, no loan term, short-term lending rate issignificantly high.Along with the rapid development of P2P lending business, some problemsarises inevitably, such as lack of clarity in the law and supervising subject,imperfection of social credit information system and shortage of credibility culture.From the point of P2P lending business themselves, imperfection of organizationstructure and internal control.From the point of P2P lending businessthemselves,there are some problems such as imperfection of organization structureand internal control,intermediate capilal capital account managemert,informationunpublished and innovation of P2Pservice.This thesis proposes some corresponding measures against the existingproblems: the macro level, the government should play the role of leading andsupervising,especially foe business to sort out the boundaries of P2P,restore offinancial intermediary information services of P2P network lending platform, and thederivative financial business of P2P network lending platform should undersupervision.The government could control the external risk by legal perfection, clarificationof the supervision subject, improving the social credit information system andstrengthening the credibility culture construction. The micro level, the P2P networkplatform in order to promote the development of the P2P network platform, theplatform should improve the ability of risk management from the inside by abidelaws and regulations, legal management, improve the organizational structure,improve the ability of risk management, regular public disclosure of information,strengthen credit rating capacity, strengthen the capital account management,improve the ability to prevent the risk of network technology and strengthen thecooperation with small loans, insurance companies, etc.