First of all, the gradually improved policy system provides a good environment for the development of P2P industry.
Every enterprise entering an industry is bound to be restricted and regulated by the system, and it must abide by the order of the industry in order to develop continuously and healthily. From the central government to the local government, under the premise of controlling regional and systemic risks, we will actively promote the healthy development of Internet finance such as P2P. 20 15 12 3 1, the State Council promulgated the inclusive finance development plan (20 16-2020). The plan pointed out that the online lending platform has convenient financing and a wide range of targets, guiding it to alleviate the financing difficulties of small and micro enterprises, farmers and various low-income groups.
Secondly, technology is the tool and driving force for the development of P2P online lending platform.
Peer-to-peer lending mainly carries out business through the Internet, which is bound to be inseparable from technical support. In the early days, due to technical means, it was impossible to provide services quickly and at low cost. In the past, P2P companies had limited ability to find and evaluate risks in the process of credit review, and could not effectively identify risk borrowers, resulting in high risk control costs. Taking the traditional loan as an example, the whole process needs to review the evidence collected offline, analyze financial statements, conduct mortgage guarantee, and be approved by leaders at different levels. It takes a long time to complete the final loan, which is time-consuming and costly. So traditional finance mainly serves high-net-worth customers. At the same time, financial institutions have established complex financial systems and rules to prevent adverse selection and moral hazard.
With the development of technology, the ability of risk control is strengthened, the accumulation and analysis methods of big data are mature, the cost of cloud storage is reduced, and the computing power is enhanced, which enables P2P loan companies to judge the risks of customers and issue loans at a very low cost. Some advanced P2P platforms can evaluate the lender's credit line according to the accumulated big data and lend within the credit line. The energy brought by technology integration is constantly emerging. In this context, the P2P peer-to-peer lending platform has a high annualized interest rate, which has successfully attracted investors' participation.
Third, the continuous release of demand from both sides of the supply chain has become an endogenous driving force for the rapid development of the P2P industry.
As a financial intermediary, P2P online lending platform is a market that connects money supply and demand through the Internet. The fund providers are composed of wealth-driven residents, and the main feature is that there are many investors. In the period of economic transformation and development, the growth rate of per capita disposable income in China has exceeded the growth of GDP and even exceeded the inflation rate. The increase of income and wages has led to the increase of residents' total wealth, which has become the basis for the development of P2P online lending.
Whether P2P can develop or not depends not only on the channel advantage of the fund supplier, but also on the fund demander. The core of China's financial repression problem is interest rate control, which leads to the low equilibrium interest rate, the lack of financial support for small and medium-sized enterprises and individuals, and the suppression of financial demand. Under the background of entrepreneurship, people's demand for financing has been fully released. On the one hand, low-and middle-income people in society have a strong demand for funds, on the other hand, these people usually lack effective guarantees and mortgages. Traditional financial institutions have high requirements for such loans, accompanied by a large number of complicated procedures. Therefore, it is difficult for low-income groups to enjoy the dividend of financial development for a long time. In contrast, P2P has a low peer-to-peer lending threshold, which greatly improves the financing availability of small and medium-sized enterprises and low-income groups.
Finally, compared with traditional financial institutions, P2P lending companies have lower transaction costs.
Improving efficiency is a very important factor. In this market, money is bought and sold, money is a different product, and its price-interest rate is the most important.
The business model of P2P is simpler: it does not absorb deposits, is not strictly supervised by banks, and does not maintain idle balances; They just keep borrowers and lenders in touch. In addition, this is done through an online platform, and most processes are automated. Operating cost is the most important factor to explain the profit rate of the industry, so P2P lending platform, like other online businesses, takes technology as an important force. P2P lending can ease credit rationing, especially for borrowers in the long tail of credit.