China Facts: Online lending is growing


An area in which China has become the global leader is online lending. In China state-owned banks dominate the financial system with preference for lending to state-owned companies. The absence of a mature system for assessing consumer credit-risk adds to bank's reluctance to lend to individuals. Fintech has started to fill this gap. E-commerce was again the launch-pad: on-line shopping platforms have developed loan services, and are using their customers' transactions and personal information to create credit scores. But the banks are fighting back. And regulators, tolerant so far, are wading in. Bernstien Research reckons that the fintech firms will grab less than a twentieth of bank's business by 2020*)    




*) Economist 25th February 2017















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Hans Henrik Pontoppidan
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The views expressed of the authors do not necessarily represent or reflect the views of DCBF.