Analysis On The Factors Why Did The P2P Platforms Collapse In China?

The industry of peer-to-peer lending in China occupies a major position in the world so far from 2014. According to statistics, the total number of peer-to-peer companies has already been 2028 by the first half of 2015. At the same time, the number of the companies had closed has been786, meaning this industry facing the industry reshuffle, so it is important for the whole industry, the companies and the investors to find the reason why the companies have closed.This paper has analysed the 786 closed companies, carried on a statistical analysis, including their registered capital, professional background, trust funds and guarantee and loan project loan interest rate, loan term, etc. Then this paper researched the factors that cause the failure of the companies from inside and outside respectively.The main conclusion of this paper is that the external factors that cause the collapse of P2P platform mainly come from the industry regulation and market environment. The deficiency of regulation and Investor education have led to the abnormal development of the industry, the pressure on the operation of the platform, and ultimately lead to the collapse of the platform. Interms of the companies themselves, most platforms exist excessive subsidies behavior, and lack of a certain self-discipline, including footfault management and risk control problem and the adverse. These factors is not conducive to the platform for the long-term development, resulting in the collapse of the platform.Finally, this paper summed up the reasons for the collapse of the P2P companies, and gave advises to the supervision department, the P2P companies and the investors respectively.