CCTV.com - CNTV English - CCTV News


Homepage > News > Biz >

China's banking watchdog warns of P2P loan risk

09-14-2011 08:58 BJT

BEIJING, Sept 13 (Xinhua) -- China's banking watchdog warned the banking industry on Tuesday about risks of the booming peer-to-peer (P2P) loans.

In the absence of intensive supervision, P2P loans are likely to evolve into illegal fund-raising, the China Banking Regulatory Commission (CBRC) said in a notice posted on its website.

The notice said P2P lending is often conducted via the Internet, and thus faces unpredictable technology risks. Without the access to trace the past record of borrowers and their repayment capacity, P2P intermediaries are unable to ensure the safety of the funds lent.

P2P intermediaries may also help people leverage the money they borrow from banks, and thus pass on risks to the entire banking industry, the notice said.

The regulator urged banks to be vigilant and prohibit their employees from being involved in the business.

As an alternative to traditional lending, a P2P loan allows the borrower to receive funds from another individual rather than a lending institution.

A P2P intermediary collects the information of borrowers and lenders, gives evaluation on the borrower's collateral such as real estate and cars, and charges service fees.

 

Editor:Zhang Rui |Source: Xinhua

Hot Videos view more

The celebrations are still continuing as the victorious coach, Joachim Loew, has been honored for his achievement in his hometown of Freiburg.
Germany coach Loew honored in hometown of Freiburg

Chinese men´s national team continued its preparations for next year´s Asian Cup, as they managed a one-all draw against visitors Jordan during a football friendly in Harbin, the capital city of Northeast China´s Heilongjiang Province.
China held to 1-1 draw by Jordan

The defending world champs came into the contest with a perfect 6-and-oh record, but they would be in for a tough first half before opening things up in the second.
USA beat Slovenia 119-76 in quarter-finals

Hot Stories more

UK authorities believe killer of James Foley is a British national

Across the UK the hunt is on for James Foley’s killer, who authorities believe is a British national. As Richard Bestic reports from London, Prime Minister David Cameron cut short his summer break to lead his government’s response.

Israeli war jets renews Gaza strike as truce talks stalled

Three Palestinians were killed and 40 others wounded in the intensive Israeli war jets´ airstrikes on the Gaza city on Tuesday night, shortly before an end of a 24-hour ceasefire in the Gaza Strip,

Missouri police arrest dozens after violent night

As the protests in the town of Ferguson, Missouri turned violent with police facing ´heavy gunfire´ from some ´criminal elements´, cops fired tear gas, stun grenades and arrested 31 demonstrators on Monday night.

Picture in news more

More Video News

Choose TV Program