SHANGHAI -- Beijing is tightening regulations on China's rapidly growing peer-to-peer lending market in an effort to curb foul play by loan brokers and head off a potential property bubble.
In peer-to-peer lending, individuals borrow money directly from deep-pocketed counterparts instead of going through banks. The outstanding balance of such lending totaled 816.2 billion yuan ($118 billion) at the end of 2016, just over twice that of a year before, according to research firm Yingcan Zixun. Many users put up real estate as collateral to take out short-term loans that usually have terms of less than a year. Transaction volume reached 2.063 trillion yuan, roughly 2.1 times the sum of the previous year.
