{"id":26908,"date":"2025-11-10T09:04:06","date_gmt":"2025-11-10T09:04:06","guid":{"rendered":"https:\/\/ipp-news.com\/?p=26908"},"modified":"2025-11-10T09:04:06","modified_gmt":"2025-11-10T09:04:06","slug":"beijing-pushes-consumer-loans-chinas-internet-firms-cautiously-revive-lending","status":"publish","type":"post","link":"https:\/\/ipp-news.com\/?p=26908","title":{"rendered":"Beijing pushes consumer loans, China’s internet firms cautiously revive lending"},"content":{"rendered":"
China’s internet platforms are quietly reviving consumer lending, taking Beijing’s push to make household borrowing cheaper as a signal that regulators may be easing a years-long crackdown on the sector, four industry sources said.<\/p>\n

Beijing began reining in what it described as “disorderly expansion” by internet platforms in 2020 by pulling the IPO of Alibaba-affiliated\u00a0Ant Group, followed by business restructuring orders and fines on Ant and others.<\/p>\n

In August, however, needing to spur\u00a0weak consumption\u00a0while managing a\u00a0trade dispute\u00a0with Washington, China introduced consumer-loan\u00a0interest subsidies, naming Ant and Tencent-backed WeBank\u00a0alongside traditional banks as eligible lenders.<\/p>\n

Internet platforms come up for air<\/p>\n

Internet platforms read the move, and earlier\u00a0high-level meetings\u00a0between Chinese leaders and prominent private-sector bosses, as a green light to cautiously expand in consumer lending.<\/p>\n

“The regulatory landscape has become more accommodative,” said an industry source. “With the current economic situation being challenging, the economy needs to rely on large internet finance platforms.”<\/p>\n

“At this point, expansion is a strategic choice and no longer a regulatory constraint,” said the source, echoing similar remarks from three others. All commented on condition of anonymity as they were not authorised to speak to the media.<\/p>\n

China’s finance ministry and National Financial Regulatory Administration did not immediately respond to requests for comment. The central bank declined to comment.<\/p>\n

Analysts and industry executives say the more stable regulatory environment positions companies like Ant and financial arms of food delivery firm Meituan\u00a0and TikTok-owner ByteDance for faster growth and fatter margins, though they warn Beijing may tighten the noose again if defaults surge.<\/p>\n

Ant Group, ByteDance, Meituan, and Baidu also didn’t respond to requests for comment. Tencent declined to comment.<\/p>\n

UBS expects lending through online platforms to rise 7.6% in 2025 from last year to 5.4 trillion yuan ($758 billion), then grow at a 7.4% compound annual pace through 2029, up from 5.7% in 2020-2024.<\/p>\n

The sector as a whole, which accounts for about a quarter of overall consumer lending, is expected to see profits surging 9.8% this year to about 110 billion yuan, UBS estimates.<\/p>\n

Its head of Greater China financials equity research, May Yan, says the “dramatic tightening” in regulations appears to have ended, which bodes well for the industry.<\/p>\n

“Now we’re entering a phase of normalised regulatory oversight,” she said.<\/p>\n

‘Good timing’ for a comeback<\/p>\n

Online consumer lending platforms backed by tech and e-commerce firms boomed in the 2010s, under a “development first, regulation later” environment.<\/p>\n

The abrupt suspension of Ant’s IPO, however, kicked off a campaign that forced fintech giants to fold financial services into separate holding companies subject to bank-like rules, including higher capital requirements and curbs on using consumer data for credit scoring.<\/p>\n

By 2023, regulators said 14 major platforms had completed restructuring, but firms stayed wary.<\/p>\n

That caution began to ease earlier this year, when Alibaba founder Jack Ma attended an entrepreneurs’ meeting chaired by President Xi Jinping, one of the sources said.<\/p>\n

“The general trend of the regulatory environment is improving compared with a few years ago,” said another person at one of China’s top three internet finance platforms.<\/p>\n

Although Beijing remains risk-averse, it increasingly views the sector as having sufficient oversight, while consumer subsidies are indirectly spurring growth, the person added.<\/p>\n

“It’s good timing,” said Zennon Kapron, director at fintech consultancy GL Insights.<\/p>\n

“If the overall economy is struggling, then you need fintech because that drives consumption by making people feel more comfortable spending if they can pay in instalments.”<\/p>\n

Consumer defaults creep\u00a0up<\/p>\n

Consumers are noticing the comeback.<\/p>\n

Shanghai resident Yang Dongdong, 41, said loan agents courted her much more frequently this year than before, with fast approval among their main selling points. She took her first-ever online loan to furnish her new home.<\/p>\n

“These loans are so easy, so I thought, why not?” said Yang.<\/p>\n

Not all firms are racing in.<\/p>\n

Two industry sources said ByteDance significantly expanded lending this year, while another source with knowledge of the matter said Tencent had discussed ambitious loan targets internally but ultimately retained a cautious stance.<\/p>\n

ByteDance did not return requests for comment on their lending strategy, while Tencent declined to answer questions.<\/p>\n

Subdued income growth and a feeble job market are pushing up consumer-loan defaults.<\/p>\n

Chinese banks and consumer finance firms put 74.3 billion yuan of non-performing loans up for sale in the first quarter, up 190% year-on-year, according to the Banking Credit Asset Registration and Transfer Center.<\/p>\n

Consumer loans were about 70% of this non-performing debt.<\/p>\n

“It\u2019s a real concern,” said Christopher Beddor, deputy China research director at Gavekal Dragonomics, who estimates 5-7% of the country’s adult population may have defaulted or fallen behind repayments on loans of any kind.<\/p>\n

The person at one of the top platforms expected Beijing to remain on alert about emerging financial vulnerabilities.<\/p>\n

“Make no mistake, the regulators still don’t want any more risks,” the person said.<\/p>\n

Some borrowers tapped online loans to refinance debt or\u00a0speculate in stocks, undermining efforts to channel credit to consumption.<\/p>\n

Car salesman Max Luo, from the eastern city of Fuzhou, defaulted on 150,000 yuan, part owed to internet platforms.<\/p>\n

“These platforms lure you with low repayment pressure promises and instant approval,” he said.<\/p>\n

Carpenter Liao Kui, from the central Enshi city, borrowed 300,000 yuan at 1.5% interest to speculate in gold and currency markets, but margin calls wiped his trades out.<\/p>\n

Struggling with a 5,000 yuan monthly interest, Liao defaulted in July on loans from Meituan and several banks.<\/p>\n

“After three payments, I’ve given up,” said Liao, whose business is floundering. “I have no savings left, only debt.”<\/p><\/div>\n","protected":false},"excerpt":{"rendered":"

China’s internet platforms are quietly reviving consumer lending, taking Beijing’s push to make household borrowing cheaper as a signal that regulators may be easing a years-long crackdown on the sector, four industry sources said. Beijing began reining in what it described as “disorderly expansion” by internet platforms in 2020 by pulling the IPO of Alibaba-affiliated\u00a0Ant […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[6],"tags":[],"class_list":["post-26908","post","type-post","status-publish","format-standard","hentry","category-english-news"],"_links":{"self":[{"href":"https:\/\/ipp-news.com\/index.php?rest_route=\/wp\/v2\/posts\/26908","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/ipp-news.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/ipp-news.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/ipp-news.com\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/ipp-news.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=26908"}],"version-history":[{"count":0,"href":"https:\/\/ipp-news.com\/index.php?rest_route=\/wp\/v2\/posts\/26908\/revisions"}],"wp:attachment":[{"href":"https:\/\/ipp-news.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=26908"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/ipp-news.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=26908"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/ipp-news.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=26908"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}