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Beijing (Failed) Protests Over Collapse of China’s Peer-to-Peer (P2P) Industry

A P2P Crisis: investors who have lost their savings tried to take their grievances to the street.

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Image via Tech Sina (http://tech.sina.com.cn/i/special/forefront/p2ppl/).

The regulatory crackdown on Chinese online lenders caused a climate of heightened tension in Beijing today, where investors who have lost their savings were trying to take their grievances to the street.

Recent crackdowns on China’s online lending industry have caused some unrest in Beijing today, where planned gatherings by victims who were trying to draw attention to their misfortune were immediately shut down by authorities.

Companies they’ve invested in were either closed down, or the directory boards have simply abandoned their business and have taken off (跑路).

Today, WeChat and Weibo have been buzzing with rumors of people being victimized by the P2P crackdown attempting to gather and protest in various places – one of them being in Beijing.

But local authorities and security guards have been quick to shut down protests, allegedly even barring some travelers from entering the city.

P2P Chaos

China’s P2P industry has seen a quick rise and fall over the past year, causing some panic and chaos.

Earlier this week, China’s New Fortune magazine reported of one case where an investor had just invested 360,000 RMB (±US$52,700) into P2P platform Guojinbao (国金宝), when they discovered the platform was already abandoned the day before, and there was no way to get their money back. It is just one among many recent cases.

Peer-to-peer (P2P) lending (defined asa method of debt financing that enables individuals to borrow and lend money without the use of an official financial institution as an intermediary“) has experienced unprecedented growth in China over the last 10 years; hundreds of microloan lenders have sprouted up, in place of traditional state-owned banks, to provide funding and capital to everything from companies to individuals.

For many Chinese investors, P2P lending is an apparent attractive alternative investment. Especially because, according to a 2015 case study by the Associate of Chartered Certified Accountants (ACCA), only 9.6% of Chinese people are able to get proper bank loans.

Since China’s mushrooming online lending companies were largely unregulated before, the rise of P2P in China has also given way to a great number of ‘troubled’ companies and lending scams.

(Note: to understand more about the rise and fall of China’s online P2P lending, read this insightful overview by Jiefei Liu at Technode. Also check out our background article “The “Wild West” of Banking in China: Andrew Collier on China’s Shadow Banking” here“.)

As of this year, China’s central government has enacted stricter rules to protect against these kinds of shady business dealings, which have already affected hundreds of thousands of investors.

Stricter monetary policies and renewed regulations have led to a wave of closures this year.

On August 2, TechNode already reported about responses to the crackdown, with people protesting in front of police stations, organizing online investor rights groups, and making collective efforts to pressure authorities to get their money back.

P2P Protests

These responses now seem to intensify. The overseas Chinese community website Boxun reported about a planned protest march in Beijing on August 6, among others near Ritan park, which was cracked down by local authorities.

Alleged bystander videos showed how people were forcefully taken away by police (video and video and video) or how people were questioned on the train to Beijing (video) (NB! We have not been able to verify if these videos were indeed recorded today, we just know that the people posting them on WeChat/YouTube claim they are).

There were also reports of people being taken away on public buses. “Have truly never seen anything like this in Beijing. We counted 120+ buses at site of the (failed) protest against P2P lending fraud, stretching far as the eye can see – all the way to Diaoyutai. Cops nap, wait in each. Petitioners rounded up, shipped off inside. The SCALE..!,” Becky Davis (@rebeccaludavis), China Correspondent for Agence France-Presse, tweeted on her timeline.

A Twitter account named “P2P China Right” (@P2Pweiquan) posted: “As a result of the government’s powerful police force and strict guard, hundreds of buses are waiting at the gate of the CBRC, About 10000 people were forced to take the bus. Announcing: the 8/6 event failed!”

Although today was an especially charged day, it is not the first time Chinese authorities are cracking down on P2P platforms. In October 2015, Chinese authorities already introduced new regulations to reduce lending fraud.

In 2016, more P2P lending companies closed operations as a result of these new regulations. Most notably was Ezubo, a ponzi scheme disguised as a peer-to-peer lender, which allegedly defrauded more than 900,000 people.

By Manya Koetse, Miranda Barnes, and Ryan Gandolfo.

Spotted a mistake or want to add something? Please let us know in comments below or email us.

©2018 Whatsonweibo. All rights reserved. Do not reproduce our content without permission – you can contact us at info@whatsonweibo.com.

Stories that are authored by the What's on Weibo Team are the stories that multiple authors contributed to. Please check the names at the end of the articles to see who the authors are.

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China and Covid19

‘Hard Isolation’ is Shanghai’s New Word of the Day

In line with a new ‘hard isolation’ measure, the entrances of some Shanghai residential buildings were fenced up.

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While some Shanghai households have already endured weeks of isolation, a new word was added to their epidemic vocabulary today: ‘hard isolation’ or ‘strong quarantine’ (yìng gélí 硬隔离)

The word popped up on Chinese social media on April 23rd after some Shanghai netizens posted photos of fences being set up around their community building to keep residents from walking out.

“New word: hard isolation. Shanghai is rotten to the core,” one commenter wrote.

The word soon turned into a hashtag page where people started commenting on the issue of fences being placed around residential buildings, voicing concerns on what a fence around buildings would mean for fire safety, especially after online rumors suggested that there had been a fire at one community in Pudong on Saturday night.

An official document regarding the ‘hard isolation’ measure was also shared online on Saturday. It is dated April 23, 2022, and its source is the Pudong New Area Office for Epidemic Control.

The document states that in line with the guidelines for the city’s epidemic prevention and control, the division between areas or zones that are in certain risk categories should be ‘optimized,’ with those in the high-risk category requiring a ‘hard isolation.’ Security guards should also be on duty 24 hours a day at the entrance of the buildings.

Earlier this month, Shanghai adopted “3-level control measures” after its initial phased lockdown. It means that local areas will be classified as “locked-down,” “controlled” or “precautionary,” based on their Covid19 risk.

“Could we also put fences around the homes of Shanghai leaders?”, one person suggested, while others posted images from the Walking Dead to mock the situation.

In the hope of Shanghai soon tackling the Covid situation, not everybody disagreed with the decision to fence some buildings or communities in the Pudong area: “I don’t disagree with it, as long as there is always someone there to open the fence in case of fire,” one person stated.

Although having a fence around their building is currently not a reality for most in Shanghai, the online photos of some communities seeing their buildings being fenced up is a reason to worry for some: “It’s been 40 days, and now they start hard isolation? This actually scares me. Before we know it, it’s June.”

One Weibo user asked: “Why is it possible to implement this hard isolation now? Was this created by the same persons who also implemented the rule to separate children from parents at isolation sites?”

“I truly can’t imagine why some people thought this is a good idea,” others wrote.

For more articles on the Covid-19 topics on Chinese social media, check here.

By Manya Koetse

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China and Covid19

‘Voices of April’: The Day After

“The best way to make videos go viral is by censoring them.”

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On April 23, a day after the video ‘Voices of April’ briefly took over social media before it was censored, the trending topic of the day is a hashtag related to new Covid cases reported in Shanghai.

Shanghai reported higher Covid-19 cases and deaths on Friday than the five days prior, which showed a daily decline in new cases. Shanghai reported a total of 23,370 new cases (including 20,634 asymptomatic ones), the municipal health commission said Saturday. A related hashtag by Xinhua News received over 910 million views on Weibo on Saturday (#上海新增本土确诊2736例无症状20634例#).

Although the hashtag was initiated by state media to inform about the Shanghai Covid situation, netizens started using it to criticize Shanghai’s handling of the crisis, with more commenters questioning China’s zero-Covid strategy. Similarly, other state media-initiated hashtag places also became online spaces where Weibo users vented their frustrations earlier this month.

Besides the ongoing online criticism and vocal disagreement with China’s Covid handling and policies, there are also many who express shock at the recent crackdown of any form of protest or criticism regarding the situation in Shanghai.

“‘Voices of April’ has been shutdown all over the internet, I’m simply dumbfounded,” one person said about the popular video that contained real recordings of events that happened during the city’s lockdown.

“If you still can find the video anywhere, forward it,” another person writes.

Besides Voices of April (四月之声), there have also been other videos over the past week that are meant to expose the mishandling of the Covid situation in Shanghai.

One of them is titled Farewell, Language (再见语言), another one is Shanghai Late Spring (上海晚春).

Farewell, Language (再见语言) is a 42-second sound art video by artist Yang Xiao (杨潇), who used over 600 commonly used propaganda phrases from Chinese official channels and randomly broadcasted the audio in the community where he lives.

The anti-epidemic workers just continue their work and do not seem to notice anything out of the ordinary at all. The video shows how this kind of language has been so normalized that for most, it has just become background noise in their everyday life – without even noticing nor critically assessing its meaning or logic anymore.

The Shanghai Late Spring (上海晚春) video is a compilation of video footage from the Shanghai lockdown, showing people struggling to get food, violent altercations between anti-epidemic workers and residents, people living in deplorable conditions in quarantine centers, and more (link to video).

The video uses the song Cheer Up London by Slaves, its chorus being:

You’re dead, already, dead, dead, already-ready
Dead, already, dead, dead, already-ready
Dead, already, dead, dead, already-ready
Dead, already, dead
.”

One Weibo commenter responded to the video in English, using a text from Les Misérables: “Do you hear the people sing / Singing the song of angry men / It is the music of a people / Who will not be slaves again!” The phrase “do you hear the people sing” was also used by other social media users to address the situation in Shanghai and the censorship of related topics.

“The best way to make videos go viral is by censoring them,” one commenter replied.

Read our previous article about ‘Voices of April’ here.

For more articles on the Covid-19 topics on Chinese social media, check here.

By Manya Koetse, with contributions by Miranda Barnes

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Spotted a mistake or want to add something? Please let us know in comments below or email us. First-time commenters, please be patient – we will have to manually approve your comment before it appears.

©2022 Whatsonweibo. All rights reserved. Do not reproduce our content without permission – you can contact us at info@whatsonweibo.com.

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