In a notorious case back in February, Ezubao, the country’s biggest online P2P (peer-to-peer) lender, was suspended from business after its involvement in a 70 billion yuan (10 billion US dollars) fraud scandal. The company’s staff reportedly used investor funds to support lavish lifestyles.
To crack down on such illegal financial activities, Li said China is now finalizing new rules on P2P lending. New legislation will limit the power of P2P platforms, banning them from taking deposits, extending loans and providing guarantee.
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