Reports are that more than 400 companies make up the first batch of the new association members. Among them are 84 banks, 44 futures brokerages, 17 insurance companies and nearly 300 internet finance companies, including P2P and crowd-funding platforms.
It was understandable that internet finance regulation took awhile to take shape. Industry development was at quite an early stage thus it has had a lot of potential for innovation. But lately, P2P scandals have caused issues around public trust, so setting up the Association seems to make sense now as it seeks to control the risks from the developing sector.
Run by China's central bank, the National Internet Finance Association aims to re-construct and regulate the booming industry, which is also the home to over 3,000 P2P firms and companies. To better regulate the controversial P2P sector, the National Internet Finance Association will closely study P2P lending companies, including the operation details, to hopefully prevent the next Ponzi scheme.
Still, the association is a private sector entity, so membership fees are required and range from 200,000 to one million yuan per year. That will pay for work on setting up universal standards for Internet finance in China, as well as providing education and information to investors. The future of China's fintech industry is promising; the state council has estimated that it will grow into an industry worth 17.8 trillion yuan by the end of 2016 and over 40 trillion yuan by 2020.