China cabinet announces plan to restrict risks in online finance

The Chinese State Council has confirmed that the country will continue to resolve financial risks in online lending and the use of shares as collateral for financing activities to protect market stability.

China’s cabinet stated that the government will speed up the development of a long-term regulatory mechanism for internet finance.

The cabinet spoke in a meeting of the state cabinet’s Financial Stability and Development Commission (FSDC) chaired by vice Premier Liu He.

The meeting comes a few days after a central government work group tasked with cracking down on online finance risks and proposed 10 new measures to curb risks caused by the troubled peer-to-peer (P2P) lending sector, to protect social and financial stability.

The state council committee also said in a statement that China will further deepen reforms of its capital markets to better serve the real economy. This includes taking the necessary measures to improve the quality of listed companies, reform stock issuance system, and broadening the long-term and stable funding sources for the country’s capital markets.

Source: Reuters

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