P2P platform bosses told not to leave Beijing before the end of May

China’s P2P industry is plagued with scandals and risks.

credit: DFIC

If you are an executive of a Peer-to-Peer (P2P) lending platform registered in Beijing’s Chaoyang district, cancel all your recent travel plans. The local internet finance watchdog informed its members today not to leave the capital before the end of May.

Executives and the ultimate beneficiaries of online P2P lending companies registered in Chaoyang are banned from leaving Beijing without “written permissions” from the financial services office at the Chaoyang District government, according to a notice published on the official public WeChat account of the regulating authority. The notice has since been deleted, but a screenshot of the notice can be found on startup news portal Chinaventure.cn.

The notice said the order came from “higher instances” and the purpose of the travel ban was to make sure these bosses could participate in the local government’s administrative checks. Beijing’s administrative checks require P2P lending platforms to provide information including resumes of their ultimate beneficiaries and executives, shareholder information and shareholders’ investment records.

China P2P industry has been plagued by scandals. A report published by the Chinese government said 1,282 P2P platforms had run into difficulties in 2018, and police investigated 186 P2P platforms. Many of the problematic platforms were registered in Zhejiang, Guangdong, Shanghai and Beijing.

The Beijing government launched a campaign to defuse financial risks involving P2P platforms last October.