Compared with the traditional way of borrowing, peer-to-peer lending has no guarantee at all. Moreover, the central bank has repeatedly made it clear that the annual compound interest rate exceeds 4 times the bank interest rate and is not protected by law. It also increases the high risk of online lending (generally 7 times or even higher than the bank interest rate).
2. Credit risk
The inherent capital of online lending platform is small, so it can't undertake large amount of guarantee. Once there is a large loan problem, it is difficult to solve it. Moreover, some borrowers also make loans for the purpose of fraudulent loans, while the founders of the loan platform have some ulterior motives, and cases of absconding with money also occur frequently.
3. Lack of effective supervision means.
Because online lending is a new financing method, the central bank and the China Banking Regulatory Commission have no clear laws and regulations to guide online lending. For online loans, the regulatory authorities are mainly neutral, do not violate the rules, and do not recognize them. However, with the prevalence of online lending, it is believed that relevant measures will be formulated and implemented in time.
The harm of peer-to-peer lending by college students;
The rates of some online lending platforms are unclear, and the expressions of handling fees, overdue fees and liquidated damages are hidden to some extent, which may tightly lock the loan students. Once the repayment is overdue, college students are likely to be unable to bear the loss of funds, which will lead to a credit crisis of over-consumption. An industry insider said that due to the low threshold of online loan installment consumption, it provides a platform for college students to spend in advance and luxury, but many college students are heavily in debt due to impulsive consumption, which brings troubles to normal study. The person also said that once the payment is overdue, it will affect the personal credit information of college students in the bank. Once you have a personal credit stain, you will have to pay more than others in the future, whether you apply for a credit card or a loan, and you may even be rejected. In addition, once these small online lending companies change, there are also hidden dangers of privacy information such as student ID cards and college student ID cards.
Peer-to-peer lending can borrow money in advance, and college students spend too much to repay it. It will also form the habit that college students like to indulge in pleasure regardless of the consequences.