Research On The Influence Of P2P Network Lending On China’s Financial Stability

As an emerging financial mode,P2 P network lending has gone through the development process of initial exploration,rapid expansion,risk explosion and regulatory norms since it entered China.P2 P network lending provides financing facilities for small and medium-sized financiers and new investment options for investors,which plays a positive role in promoting financial stability and economic development.Meanwhile,due to its own operation mode,blind expansion and long-term absence of supervision,a series of risk events broke out in the P2 P online lending industry.Before discussing the governance of the industry,the positioning of P2 P online lending in the financial system should be made clear.Therefore,it is necessary to study the impact of P2 P online lending on China’s financial stability,and to explore whether the positive impact of P2 P online lending can offset the financial market fluctuations and risks it brings.This paper attempts to study the influence of P2 P online lending on financial stability and puts forward relevant policy Suggestions.This paper first summarizes the existing research literature from the two aspects of P2 P online lending and financial stability,and finds that there are few literatures that directly study the influence of P2 P online lending on financial stability.Then,by reviewing the development process of P2 P online lending industry in China,the paper analyzes the current situation of P2 P online lending.Since P2 P online lending entered China,it has made great progress,but many risks have also erupted.Then from the positive and negative aspects of P2 P network lending on financial stability and the impact of the mechanism.Finally,by using the principal component analysis method to construct comprehensive indicators of financial stability,the structural vector autoregression(SVAR)model was established to empirically test the impact of P2 P network lending on financial stability indicators and analyze the impact on various financial stability factors.The results show that the income index of P2 P network lending can have a negative impact on financial stability in the short term,while the long-term impact tends to be zero.However,P2 P transaction volume will have a positive impact on financial stability in the short term and a smaller negative impact in the long term.In addition,according to the research conclusion,the paper puts forward relevant policy Suggestions from the following three aspects: perfecting the supervision mechanism,constructing the risk warning system and protecting the rights and interests of investors.