In the news: The CBRC clamps down on P2P loans, banks miss out on consumption data from increasing mobile payments and lenders take the hit from industrial restructuring

CBRC imposes caps on P2P lending the new measures One longstanding obstacle to regulating shadow banking was the need to get multiple government agencies to agree on a framework that addresses all of the sector's various components, from financing and tech to public safety and mass online data. These measures, jointly issued by the China Banking Regulatory Commission (CBRC), Ministry of Industry and Information Technology (MIIT), Ministry of Public Security and Cyberspace Administration of China, show an effort to clean up a system that keeps loans off bank books and increases risks in the broader financial system. That said, shadow banking has been around for a long time in China and may be difficult to weed out, not least because there is strong demand from smaller companies that find it difficult to obtain funding elsewhere (also from individuals who simply find it more convenient to borrow money online). Why shadow banking may never be properly regulated Office of the China Banking Regulatory Commission, Circular on Regulating the Credit Asset Benefit Right Transfer Business of Banking Financial Institutions People's Bank of China and China Banking Regulatory Commission, Guiding Opinions on Enhancing Financial Support to New Consumption Sectors State Administration for Industry and Commerce, Implementing Regulations for the PRC Law on the Protection of the Rights and Interests of Consumers (Draft for Comments) The rise of mobile payments cuts banks' access to data This means lenders are missing out on critical transaction data that would help them provide competitive products and services, analysts said, and the trend is emerging just as Chinese banks' traditional lending businesses are under pressure from interest rate deregulation, rising defaults and the need to curb loan growth due to the country's excessive reliance on credit. Rich data on consumption habits both on and offline would go a long way to boosting retail banking products and services and help domestic financial institutions adapt to the industry's evolution. China also recently opened up the credit card market to foreign companies, but it's unlikely that their entry will have a significant impact on this trend. People's Bank of China and China Banking Regulatory Commission, Measures for the Administration of Bank Card Settlement Institutions Provisions for the Administration of the Information Services of Mobile Internet Application Programs Department of Electronic Commerce and Informatization of the Ministry of Commerce, Service Standards for Electronic Commerce Business in Connection with Mobile Products (Draft for Comments) China's banks to take the hit for industrial restructuring Caixin. This report reflects the contradictions of China, with President Xi Jinping allowing failures of even state-owned companies because of poor performance even as some regions prop up unprofitable firms for fear of igniting financial and social instability. Even so, the days of implicit state guarantees are coming to an end. Payment failures have surged this year, with Bloomberg reporting that the total principal of defaulted notes has risen to Rmb22.5 billion from 2014. Even Sichuan Coal Industry Group missed a bond payment in June, an ominous sign that even the once unassailable SOEs have to perform. GE China interview: Compliance, big data and projects National Development and Reform Commission and Ministry of Environmental Protection, Measures for Cleaner Production Audits National Energy Administration, Guiding Opinions on the Establishment of a Guidance System for Targets of Renewable Energy Development and Utilization CBRC imposes caps on P2P lending the new measures One longstanding obstacle to regulating shadow banking was the need to get multiple government agencies to agree on a framework that addresses all of the sector's various components, from financing and tech to public safety and mass online data. These measures, jointly issued by the China Banking Regulatory Commission (CBRC), Ministry of Industry and Information Technology (MIIT), Ministry of Public Security and Cyberspace Administration of China, show an effort to clean up a system that keeps loans off bank books and increases risks in the broader financial system. That said, shadow banking has been around for a long time in China and may be difficult to weed out, not least because there is strong demand from smaller companies that find it difficult to obtain funding elsewhere (also from individuals who simply find it more convenient to borrow money online). Why shadow banking may never be properly regulated Office of the China Banking Regulatory Commission, Circular on Regulating the Credit Asset Benefit Right Transfer Business of Banking Financial Institutions People's Bank of China and China Banking Regulatory Commission, Guiding Opinions on Enhancing Financial Support to New Consumption Sectors State Administration for Industry and Commerce, Implementing Regulations for the PRC Law on the Protection of the Rights and Interests of Consumers (Draft for Comments) The rise of mobile payments cuts banks' access to data This means lenders are missing out on critical transaction data that would help them provide competitive products and services, analysts said, and the trend is emerging just as Chinese banks' traditional lending businesses are under pressure from interest rate deregulation, rising defaults and the need to curb loan growth due to the country's excessive reliance on credit. Rich data on consumption habits both on and offline would go a long way to boosting retail banking products and services and help domestic financial institutions adapt to the industry's evolution. China also recently opened up the credit card market to foreign companies, but it's unlikely that their entry will have a significant impact on this trend. People's Bank of China and China Banking Regulatory Commission, Measures for the Administration of Bank Card Settlement Institutions Provisions for the Administration of the Information Services of Mobile Internet Application Programs Department of Electronic Commerce and Informatization of the Ministry of Commerce, Service Standards for Electronic Commerce Business in Connection with Mobile Products (Draft for Comments) China's banks to take the hit for industrial restructuring Caixin. This report reflects the contradictions of China, with President Xi Jinping allowing failures of even state-owned companies because of poor performance even as some regions prop up unprofitable firms for fear of igniting financial and social instability. Even so, the days of implicit state guarantees are coming to an end. Payment failures have surged this year, with Bloomberg reporting that the total principal of defaulted notes has risen to Rmb22.5 billion from 2014. Even Sichuan Coal Industry Group missed a bond payment in June, an ominous sign that even the once unassailable SOEs have to perform. GE China interview: Compliance, big data and projects National Development and Reform Commission and Ministry of Environmental Protection, Measures for Cleaner Production Audits National Energy Administration, Guiding Opinions on the Establishment of a Guidance System for Targets of Renewable Energy Development and Utilization