The assist-lending industry should return to the original purpose of financial services

Ask AI · How do peer-to-peer lending platforms balance inclusive finance with profitability needs?

Recently, in response to problems in internet-based peer-to-peer lending businesses, the Financial Regulatory Administration held talks with the operating institutions of multiple internet peer-to-peer lending platforms. The talks directly targeted three major persistent issues in the peer-to-peer lending industry: “marketing inducements,” “opaque disclosure of interest and fees,” and “non-compliant post-loan debt collection,” requiring platform operating institutions, when collaborating with financial institutions to carry out lending business, to effectively standardize marketing and promotional conduct; clearly and unambiguously disclose interest and fee information of lending products; strictly comply with personal information protection requirements; carry out debt collection in accordance with the law; improve customer complaint resolution mechanisms; and effectively protect the lawful rights and interests of financial consumers.

There are many irregularities in the peer-to-peer lending industry in the current financial consumer sector. The China Consumers Association’s 2025 complaint analysis report shows that consumer association organizations nationwide accepted 14,791 complaints related to financial services, an increase of more than 118% year over year. The issues most concentrated in consumers’ reports include: opaque borrowing costs; actual interest rates far exceeding the promotional benchmark; excessive collection of personal information and even leaks; improper debt collection practices; and complaint channels that are effectively meaningless. These problems disrupt industry order, harm consumers’ rights and interests, and urgently need to be rectified.

As early as 2021, the People’s Bank of China issued an announcement requiring that all loan products must clearly state the annualized loan interest rate. However, many internet platforms and financial institutions, after disclosing the annualized interest rate, raise the overall cost by charging various fees such as service fees, guarantee fees, fees for collateral pledge/guarantee (including mortgage/pledge and related costs), and consulting fees.

Apart from arbitrarily raising financing costs by inventing names for fees, some platforms deliberately magnify the lending entry points and shrink the normal payment buttons in everyday consumption scenarios such as booking flights, hotels, ordering takeout, or buying beverages. They may also induce users to click on borrowing by using colors and layout designs. Many consumers activate loans without knowing it, which leads to interest and related fees and damages consumers’ rights and interests.

The original intention of online lending is to provide convenient financing channels for small and micro enterprises and ordinary individuals, embodying the value of inclusive finance. Internet peer-to-peer lending platforms should uphold the original inclusive purpose, regulate their own lending behavior, and protect the rights and interests of financial consumers; they must resolutely prevent situations such as inducing financial consumers to borrow excessively, conducting violent debt collection, or leaking users’ privacy.

Peer-to-peer lending platforms and commercial banks should take the talks and rectification as an opportunity to drive their own business transformation, fully integrate consumer rights protection into the entire business process of product R&D, risk control, and service optimization, and actively and effectively improve the level of consumer protection.

At the same time, the credit enhancement service fees charged by credit enhancement service institutions to borrowers should be included in the comprehensive financing costs, and should not be covertly raised in the form of consulting fees, advisory fees, or other similar charges by disguising the credit enhancement service fee rate. By using transparent, end-to-end cost accounting and making fee collection transparent, hidden fee irregularities in the peer-to-peer lending industry should be eliminated. Peer-to-peer lending platforms need to thoroughly abandon old models such as interest-and-fee ambiguity and bundled sales, and return to the foundation of financial services.

Regulated development is the proper way for the industry to operate in a healthy manner. Commercial banks and cooperation institutions for internet peer-to-peer lending should comply with the state’s relevant regulations on online marketing, and fully disclose key information to borrowers, including the loan principal, annualized loan interest rate, credit enhancement service institution, credit enhancement service fee rate, annualized comprehensive financing cost, and all interest and fee items that may arise after a loan default, to safeguard users’ right to know and the right to fair transactions. Commercial banks should strengthen management of post-loan debt collection for internet peer-to-peer lending business; if they find any violations in debt collection, they should promptly correct them. In cases that are serious, measures such as terminating cooperation should be taken to curb the occurrence of irregularities. (Author: Peng Jiang Source: Economic Daily)