China tightens rules for digital lending

China tightened its rules for digital lending to clarify loan management requirements and independent risk control for commercial banks, and to increase data protection.

The move also aims to strengthen loan fund management and protect consumer rights, the China Banking and Insurance Regulatory Commission said in a July 15 release.

The new rules also require commercial banks to standardize digital loan cooperative operations with third-party institutions, including ensuring that such businesses remain separate from other service loan agreements.

Digital loans issued between the release of the directive and the end of the transition period on June 30, 2023, have to comply with the rules, the regulator added.