Recently, the leading group of mutual financial regulation and the leading group of online loan regulation jointly held a teleconference on the special regulation of Internet Finance and online loan risks. Officials from the relevant departments of the Central Committee and the offices of the rectification groups of provinces and cities all over the country attended the meeting. The meeting systematically summarized the remediation work in 2019, comprehensively analyzed the difficulties and challenges faced by the current Internet Finance and Internet loan risk remediation, and defined the objectives and tasks of the 2020 Internet Finance and Internet loan risk special remediation. The meeting requested that, in the next step, we should actively and steadily finish the work of special rectification and closing down officials, so as to create favorable conditions for winning the battle of preventing and resolving financial risks and ensuring the building of a moderately prosperous society in an all-round way.
Since 2019, risks in Internet finance such as Internet lending have continued to converge nationwide, and substantial results have been achieved. As of March 31, 2020, there are 139 online lending institutions in operation in China (hereinafter referred to as "online lending institutions"), 86% lower than the beginning of 2019; the loan balance is 75% lower; the number of borrowers is 80% lower; the number of borrowers is 62% lower. The number of institutions, the scale of lending and the number of participants declined for 21 consecutive months. Since the implementation of the rectification work, nearly 5000 institutions have withdrawn. The stock risks in other fields such as Internet asset management, virtual currency speculation and illegal foreign exchange transactions were cleared in an orderly manner.
The meeting pointed out that over the past year, all departments and localities have rationally grasped the timing and pace of remediation efforts, strengthened the linkage between the top and the bottom, acted bravely and actively, implemented classified policies, insisted on the withdrawal of institutions as the general direction of remediation work, and strived to "withdraw as far as possible and close as possible". Throughout the year, we adhered to the principle of seeking progress while maintaining stability, not being urgent but not slow down, and focused on promoting the benign withdrawal of institutions. At the same time, some accumulated risk points have been cleared and a number of long-standing cases have been disposed. The risk situation in Internet Finance and online lending has fundamentally improved.
According to the meeting, although great achievements have been made in the special rectification of Internet Finance and Internet loan risks, it should also be noted that the current situation is still very complex and there are still some problems that have not been fundamentally solved. This year, the novel coronavirus pneumonia has brought new challenges to the work of rectification, which is a tight and heavy task and difficult task. First, the work of "three demolitions" of the remaining operating institutions has progressed slowly, and it is very difficult to follow up. Second, the disposal task of the closed institutions is still arduous, and the stock risk of the closed online lending institutions is still high. The problems of "retreat but not clear" and "retreat but not clear" are prominent, and it may take a long time to resolve the risks. Third, there are many difficulties in institutional transformation. Some institutions are not willing to transform or have insufficient transformation ability. In the process of specific promotion, there will be many new situations and new problems, and a lot of hard and meticulous work needs to be done. Fourth, due to the uncertainty of epidemic prevention and control, the operation, collection and transformation of online loan institutions have been affected to some extent.
The meeting stressed that 2020 will be the year of the completion of building a moderately prosperous society in an all-round way and the 13th five year plan, as well as the year of the end of the battle to prevent and resolve financial risks. It is of great significance to do a good job in the special rectification of Internet Finance and online lending risks. In accordance with the overall requirements of the financial committee of the State Council and the work deployment of the two leading groups, we will strive to basically complete the main objectives and tasks of the special rectification of Internet Finance and Internet loan risks by 2020. All regions and departments should take stock risk disposal as the core work for a long period of time. On the premise of adhering to the principle of marketization and rule of law, they should take measures according to local conditions and take multiple measures to protect the legitimate rights and interests of investors to the maximum extent. We will further increase the pressure drop of stock, reduce the scale of business, and accelerate the implementation of the pilot work of institutional transformation. We will increase punishment for borrowers' malicious evasion and abandonment of debts, accelerate the process of bringing online loan credit information into the credit system, and improve the joint punishment mechanism for dishonest borrowers. At the same time, we will strengthen the monitoring of new risks in other areas, such as Internet asset management, virtual currency speculation, illegal foreign exchange transactions, and establish a mechanism to quickly study, determine, and deal with them, so as to maintain a high-pressure situation and prevent the resurgence of the dead. All relevant departments around the country should conscientiously summarize the experience and lessons of Internet Finance and Internet loan risk management, and comprehensively implement the overall requirements of "financial business must be licensed operation". Continue to focus on the problem of "unlicensed driving" in the financial field, explore the early detection and early disposal mechanism of illegal financial business of non licensed institutions, further accelerate the construction of long-term mechanism of Internet financial supervision, and truly prevent and resolve Internet financial risks from the source.
