Hundreds of peer-to-peer (P2P) lending victims in Shanghai gathered outside of the China Banking Regulatory Commission (CBRC) building on Sep. 12 to protest against P2P scams. They were driven away by the police violently before roughly a dozen people were arrested.
P2P allows people to lend to each other while earning high-interest rates—higher than those offered by banks. Firms that operate a P2P platform connect yield-hungry investors with cash-strapped individuals or small businesses.
In recent weeks, scores of platforms in this poorly regulated sector shut down or suspended operations without compensating their investors, many of whom put down their life savings into such ventures. This has caused many middle-class families to suffer huge financial losses.
“About two or three hundred of people have gathered there,” said Yifan, a victim of Lianbi Finance, one of the four big high-interest P2P lending platforms, which closed overnight on June 20 without warning. “More than ten people were arrested on the spot,” she told the Chinese language Epoch Times in an interview on Sep. 14.
Shanghai police shouted at the protesters using a loudspeaker and threatened to arrest them if they did not leave, according to protesters’ accounts. Before the police finished talking, they had already begun rushing to the main entrance of the CBRC building, pushing the protesters to leave.
From recorded videos posted online, police officers could be seen pushing people to the ground roughly. Onlookers erupted in outrage whenever a protester was carried away.
Another financial victim, Mr. Zhang, told the Chinese language Epoch Times that the protesters were mostly from Shanghai City and its neighboring suburbs. He said many others who were being monitored by police could not come out to protest. “It’s impossible to go to Beijing now [to protest]. We went to the CBRC because officials in the Shanghai financial services office told us they don’t have the right to discipline online lending platforms, which are all under CBRC’s jurisdiction. So we went to the CBRC.”
Wangdaizijia, China’s first web portal for online P2P lenders, reported on Sept. 1 that as of the end of August 2018, there are 6,406 P2P lending platforms in China, among which 4,811 have closed or run into other problems—accounting for 74 percent. According to some Chinese media estimates, the total amount of funds in question is up to one trillion yuan ($145.37 billion), with scam victims numbering in the tens of millions.
Epoch Times staff member Luo Ya contributed to this report.