China seeks to strengthen its control over online financial startups

30 October 2017

Chinese authorities are looking to tighten their regulations of the online financing websites as the fintech lending services raise concerns amid loose regulations of the market. Caixin Media Company Ltd.,a Beijing-based media group, reported that an official from the financial markets department at the People’s Bank of China said that the central bank joins forces with other governmental bodies to introduce the newly developed regulation to control financial risks associated with online lending.

According to the official the implementation of the new regulation has already proven to be successful in several cases. The report further adds that China has plans to lift the regulation bar for all online businesses dealing with finances with all financial activity to be brought to the minimum level of control.

Companies in China providing microcredits are at the epicenter of complaints over imposing higher interest rates on borrowers. Separately, at the beginning of October a report was published that within the coming six months a regulation would be in place to control the business practices of online microcredit companies. The list of markets to be controlled by the authorities in China was increased to include wealth management companies.

At the moment China is intensifying its control over the cryptocurrency markets with ICOs and bitcoin exchanges banned in the country on concerns that the currency may be volatile and risky for consumers.

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