(ECNS) -- The majority of China's peer-to-peer (P2P) lending platforms have yet to meet a new requirement by regulators to have a bank as their fund depository agent, the Economic Information Daily reported on Friday, citing a latest study.
On July 18, China's central bank, the China Banking Regulatory Commission, and eight other government departments, issued a guideline on promoting the healthy development of Internet finance, making it clear that banks should be chosen as fund depository agents for P2P platforms, in a bid to better protect investor interests.
However, only 48, or two percent, of China's 2,400 or so P2P lending platforms met the new requirement, according to data from the Shanghai Ying Can Investment Consulting Co, an Internet finance research agency. Although 149 P2P platforms had signed fund depository agreements with banks, few had materialized, it was added.
An executive with a joint-stock bank told the paper that banks were worried that cooperation with P2Ps might put their reputations and interests at risks, because the P2P market lacked robust regulation. The bank had had no fund depository cooperation with any P2Ps so far, it was added.
All 48 P2Ps already in cooperation with banks were large in scale and enjoyed good credit ratings, with most having registered capital of more than 100 million yuan ($15 million), the paper said.
Banks were becoming increasingly cautious in entering into cooperation with P2Ps, and some had even halted P2P fund depository business, according to the paper.
The majority of the banks that do provide fund depository services for P2Ps are joint-stock or city banks, the paper reported.
Zhang Yexia, an analyst with Ying Can, attributed the slow progress partly to the fact that implementation of such agreements requires much investment in technology and HR talent, and thus takes time, according to the report.
Regulators have offered 18 months as a transition period for P2Ps to met the requirement.