5 minutes to read the essence of Chinese Internet finance

With the internet finance wave after wave of surging, the market in a subdivision area, Peer-to-peer, is hot, a peer-to-peer platform monthly turnover of less than 2.3 billion yuan, are embarrassed and others say that they are doing peer-to-peer. According to the current trend, conservative estimates, this year to achieve 305 billion yuan this level of Peer-to-peer platform, at least 15, which includes both the high and the official platform, but also from the Internet field to kill the upstart, there are hidden work and name, not professional players completely unaware, But the turnover can scare you to death the Shaolin monk-style platform, but also let this field full of mysterious temptation.

Peer-to-peer this business, why in China all of a sudden become so hot, what is the business in the end, what kind of risk, what kind of benefits, will have a financial situation in China what kind of impact? Today, we are going to make a table with you.

China's peer-to-peer development to this day, already and peer-to-peer originator of the United States play, is not a concept, from the size of the transaction, almost 50 times times more than the United States, the industry's evolutionary degree, but also in fact, more advanced than the United States, the boast that peer-to-peer this thing China has played to the world's leading level, Do not blush at all.

Before we talk about Peer-to-peer, we first have to recognize one thing: peer-to-peer, no matter what kind of fancy vest, it is only a part of China's private credit, or the reality of China's private finance, the Internet, it has not brought new problems, but the traditional folk finance amplification, the benefits are magnified, The downside is magnified. So, to really understand the peer-to-peer, first we have to understand the reality of China's private finance.

Chinese folk finance (or commonly known as usury), has been two of the main players, a small loan company, another called the guarantee company.

Let's talk about a small loan company. The small loan company is a very Chinese-style financial institution (there is no such thing as a small loan company in America), it is a lending institution that has been limited to the financing function. According to China's regulations on financial regulation, small loans companies are strictly restricted the function of direct financing, can not absorb deposits, not to issue stocks, cannot issue bonds, can obtain a little bank loans (not more than 50% of registered capital), basically can only use their own funds to lend.

However, as a financial institution, so that it does not finance, only with its own funds, from the business logic is impossible, for a long time, the small loan company has been using a variety of ways to break through this limit, the previous most popular approach is the underground capital chain.

Each small loan company's periphery, is active this group of people, we call "the money broker" or "the fund two-way", they rely on personal relations, the left hand to borrow money, right hand add a two points, put to the small loan company, (if there are friends in Zhejiang, Fujian, Guangdong, I think each of you may know a few such buddies), Over time, many people find that the money is particularly good, left hand in, right hand out, nothing to do, but also earn a lot, they do this, so, this circle of people have a home, under the next home, under the next home, 09 to 11 The craziest time, a sum of money, It takes more than 10 two-way to reach the end of the section.

The excessive development of this capital chain brings a lot of problems. The first is the cost of capital abnormally high, more than 10 two-way, a person peel a layer of skin, the highest when the cost of light channel is almost 10%.

The second is a long fund chain, the risk is particularly high, one aspect of the problem, the entire capital chain hung off, the most typical is 11 years 12 years of Wenzhou and Ordos, in fact, the poor rate of private lending is not so scary, but also on the appearance of 15%, but is the capital chain, a point of the enterprise, more than 10 level two-way, Dozens of two-level two-way, hundreds of three-level two-way all problems, and all is debts, no solution, it collapsed.

The third is the capital chain once the problem, the government is easy to buckle up on the illegal financing of the hat, the economic disputes to rise to the height of the criminal, so, these years, the small loan company bosses actually very headache this problem.

Later, Peer-to-peer this thing appeared, small loan company bosses suddenly found, peer-to-peer this model is to solve the problem of capital chain of a baby AH: Before, I was to change money to lend, profit margins, today I can switch to a model, I do not lend, I "recommend" debt to the Peer-to-peer platform, and then charge a high "intermediary fee" , and then take on the security responsibility, although in essence, this thing is a peer-to-peer platform to do two-way, but with this model, first, the small loan company in the entire transaction legal, will not worry about the "illegal financing" of the hat, second, Peer-to-peer platform this two-way, at least the cost of capital than other two-way low, And the link is short, only together, the risk is more controllable. As a result, it formed a peer-to-peer in the first faction, small lenders.

Next, the more senior faction in the Peer-to-peer, the guarantee faction also appeared.

The guarantee company, the financial institution's original role is to help the banks spread risk, the bank that it thought some of the risk of loans to the guarantee company underwriting, while giving a certain guarantee fee, this is a normal thing, but in China a bit out of shape.

Because in the Chinese financial system, banks are absolutely strong, therefore, the bank to the guarantee company's premium is very low, is generally 1.5%-2% of the guarantee amount, on the other hand, China's guarantee company's supervision is very strict, according to the regulation of the Financial Bureau, each guarantee business, you have to put the premium of the 50%+ guarantee amount of 1% deposited into a regulatory security deposit account, can not move, the premium of the 50%+ guarantee amount of 1% total is exactly the amount of 2%, that is, guarantee company serious carry out the guarantee business, a penny loose not see, froing Guarantee Company even survive, also help the bank carried a pile of risk.

Over time, the owners of the guarantee company will not do, the heart said that I am doing for a long time is for the bank to take the blame, but also earn money. So, naturally, the guarantee company will go to do some things that can make money, this is to lend, guarantee company lending is a natural advantage, every day in contact with the bank loans customers, their own wind control ability and very strong, sneaking their own loans, this money to earn not too comfortable ah.

But there are two big problems with this thing, first, the guarantee company lending is strictly prohibited by law, is an illegal business, second, lending need money, the guarantee company must pass some gray means to obtain funds, this includes the previous said underground capital chain, and another is to withhold loans ( For example, the guarantee company to a customer guarantee to get 50 million loans, it allows customers to take away 40 million, their own 10 million to stay in usury), are very risky play.

and peer-to-peer appearance, all of a sudden, it's the two problems have been solved, I do not lend, I "recommend" debt to Peer-to-peer platform, and then charge a high intermediary fees and guarantee fees, in essence, is the Peer-to-peer platform wholesale funds to guarantee companies, lending by the guarantee company.

Understanding the relationship between the two private financial players and the peer-to-peer, it is not difficult to understand why in China, Peer-to-peer will appear so Shing pattern.

From the commercial logic, the advent of Peer-to-peer, is actually the evolution of China's private finance, first, the transaction structure is legitimate, and secondly, we really do their own good things, small loans companies, expertise is put out, collected back, regardless of how high interest rate, the guarantee company, is simply to assume the responsibility of the security. The only problem here is regulation, because through peer-to-peer, it actually breaks through the policy design that small lenders cannot finance and guarantee companies cannot lend. So that's why small lenders, guarantee companies and Peer-to-peer platforms have been very low-key in this matter, unwilling to come out and explain why.

But with the quickening pace of financial market liberalization and a clear trend towards peer-to-peer policy, I believe that Peer-to-peer will have a faster and more professional evolution.

Another talk about the future, along with the rapid development of peer-to-peer, banks and Peer-to-peer will also have a war, today, the balance treasure is in copy bank deposit of the posterior, peer-to-peer slightly more than a few days, to grow some, will copy bank loan of the posterior, the bank this Charybdis, there will be a bloody battle, as to what time, I estimate, It's about winter.