A report from the Beijing Bureau of Financial Work says 90% of P2P platforms will struggle to stay in business in 2017; if their predictions are correct that would reduce the total number of P2P companies from 4,856 to approximately 500; companies will begin to undergo a review by regulators and it is expected that a run on deposits is likely to occur; regulators will be checking for a number of variables including two new requirements: the appointment of a custodian bank and full disclosure of the use of deposits; other factors under review will include risk management, business scale, IT infrastructure, investment sources and shareholders' credibility; firms will either be granted a P2P lending license or be required to liquidate; in 2016 the industry accounted for 800 billion yuan and according to the Beijing Bureau of Financial Work it is likely that 2017 will end drastically different for the industry overall. Source
Ant Financial has formed a strategic partnership with Kakao Pay which includes a $200 million investment and partnership to offer enhanced digital financial services in South Korea; services will include enhanced bill payment, remittance and payment transactions; according to Young-Joon Ryu, Kakao Pay's CEO-elect, "The combination of Ant Financial's global payment platform Alipay and numerous financial and commerce service networks and Kakao's platform capabilities will result in more effective and convenient financial solutions for both businesses and consumers." Source
Afterpay and Touchcorp are merging to form NewCo which will provide an advanced solution for merchant network installment payments; Afterpay has steadily grown its merchant network which pays a 4% fee for the installment service; Touchcorp will help provide advancements in payments technology for Afterpay and the integrated services will allow for broader expansion. Source
AT Zuche is a Shanghai-based peer-to-peer car rental platform with over five million users and 200,000 vehicles; it has announced a $58 million Series C financing round from investors including Matrix Partners China; Matrix Partners China also recently invested in insurtech app Anxin Doctor which raised RMB200 million ($28 million) for a healthcare service focused on women and children; CreditEase Insurance Agency, a CreditEase affiliate, has also added new capital of RMB80 million ($11 million) for its insurance platform. Source
Lufax sees a growing market opportunity in China's retail investment space and is planning to increase its focus on this area of the business; the firm is currently the world's highest valued P2P lender at $18.5 billion; it has $56.9 billion in client assets with P2P loans accounting for a third which is expected to decrease to 15%; it plans to expand the investments it offers through online brokerage accounts and also enhance its mobile and online trading capabilities; the firm is also rumored to have plans for an initial public offering in Hong Kong in the second half of 2017. Source
China's State Administration of Foreign Exchange continues to closely monitor foreign investment with no change reported to the limit for its qualified domestic institutional investors (QDII) scheme following its most recent meeting; the outstanding investment quota under the QDII scheme, which allows investment managers to raise funds and convert them internationally, was US$89.99 billion at the end of February; the country continues to seek to protect its currency from depreciating with the foreign investment quota. Source
The People's Bank of China (PBOC) is testing digital currency in efforts to become one of the first central banks to issue digital money; China's population has been increasingly using digital forms of payment with approximately 450 billion mobile users reported in 2016; a cryptocurrency would likely be popular among consumers and is also expected to lower transaction costs for sellers; a digital currency could also help the PBOC to more efficiently manage risks in the financial system and economy with a better way for tracking transactions; the PBOC has outlined how a digital currency would work but it has not announced a specific timeline for implementation. Source
In collaboration with Energy 4 Impact, UKAid and the CME Group Foundation, the Cambridge Center for Alternative Finance has released a study on crowdfunding and P2P lending in Africa and the Middle East; Lend Academy provides details of the report in their article; covers 46 countries in Africa and 12 countries in the Middle East, featuring data on 70 alternative platforms. Source
Noah Holdings Limited, a wealth and asset management services provider in China, has announced its fourth quarter and full year results for 2016; the firm has two leading services including asset management and internet finance; net revenues for the full year 2016 were RMB 2,513.6 million (US $362.0 million), an 18.6% increase from 2015; for the year the firm reported an operating margin of 26.5%, compared to 26.4% for 2015; the firm's internet finance business is led by Mr. Kenny Lam, who reported that the company was pleased with the results, also stating that, "Our newer businesses – asset management and internet finance – are bringing impactful results to the group." Source
In business for six years, Lufax has expanded to meet a growing market demand for fintech products in China with a number of factors helping its success; beginning as a P2P lending firm with the support of Ping An the firm has been able to expand its business to wealth management and overall sees an underserved domestic market of over one billion people interested in the firm's solutions; it now has over 25.5 million registered users, RMB390.92 billion ($57 billion) of retail assets and RMB111.65 billion ($16 billion) of loans under management; it has been able to successfully navigate the market challenges with help from Ping An and is now approaching an even more global introduction through its potential initial public offering expected for later this year in Hong Kong which could raise approximately $5 billion for the firm. Source