Another scandal brews in China’s P2P lending sector as authorities investigate Hangzhou’s largest microloans provider
- Hangzhou’s public security bureau said they will be taking action to prevent losses at Weidai and recover stolen funds
- China has raised the bar for P2P lenders, including increasing the minimum registered capital to 1 billion yuan for an online microlending licence
“The public security authorities will start checking and exerting control over the relevant assets and manage the process of stolen funds retrieval and loss limitation,” according to a statement released late on Saturday by the city’s public security bureau.
The authorities appealed to the company’s creditors to cooperate with the investigation and not to believe in and spread rumours. They also said that they would come down hard on illegal gatherings if the creditors do not express their claims in a reasonable and rational manner.
In a separate statement posted on its Weibo account addressed to Weidai (Hangzhou)’s online borrowers, the bureau urged them to “proactively” repay their loans. Those who fail to do so on time will be included in the government’s “social credit system blacklist” which could block them from future purchases for daily necessities, access to public transport and bank loans.
Emails and phone calls to the company requesting comment on the investigations were not answered.