Loan intermediaries go quiet as new rules reshape China's online lending sector

Industry Quietens Down as Regulatory Crackdown Intensifies

In recent weeks, China's once-booming loan facilitation (助贷) industry has gone unusually quiet. Loan intermediaries who previously flooded social media with "instant approval" advertisements have now restricted their WeChat Moments to "show only the last three days."

The shift stems from the Financial Product Online Marketing Management Measures (《金融产品网络营销管理办法》), which took effect on September 30. Under the new rules, organizations or individuals other than financial institutions and authorized third-party internet platforms are prohibited from conducting or indirectly engaging in online marketing of financial products.

Since the introduction of the "Loan Facilitation New Regulations" (助贷新规), a series of regulatory measures have been rolled out, triggering a systemic restructuring of the industry. Experts believe the era of unchecked growth is over, and compliance capability will become the baseline for market entry.

The Ebbing Tide of Loan Facilitation

Although the Measures apply to all financial institutions and products, they impose a fundamental constraint on loan facilitation platforms at the customer acquisition stage—directly targeting the industry's dominant traffic-redirection model.

Previously, platforms from Xiaohongshu to Xianyu, Douyin to Kuaishou, and WeChat Moments to QQ were all used as traffic channels by loan intermediaries. To bypass platform oversight, intermediaries even developed coded jargon such as "flower accounts" (花户), "white accounts" (白户), and "black accounts" (黑户). These practices are now subject to strict regulation.

"The era of loan intermediaries freely posting advertisements is over," said Zhang Guojia, a lawyer at Jiangsu Saint Kingway Law Firm. He explained that if a loan intermediary posts a loan ad on WeChat Moments without formal authorization from a financial institution, it constitutes "an organization or individual indirectly conducting online marketing of financial products," violating Article 2 of the Measures. Even with authorization, intermediaries cannot use titles such as "×× Loan Center" or "×× Credit Consultant"—product information must be published under the financial institution's own name.

Zhang noted that intermediaries can only serve as "channels," not "speaking entities." Common phrases like "blacklisted borrowers eligible," "instant approval," "ultra-low rates," and "no fees" are all considered违规 content.

Beyond banning misleading language and unlicensed marketing, the Measures also prohibit:

• Multi-level sub-entrustment and "matryoshka-style" traffic redirection
• Bundling of payments with credit products
• Redirecting users to non-self-operated platforms (API-based invisible redirection is banned)

A Broader Regulatory Framework

The Measures represent only one part of a broader regulatory push. Since last year, several policies targeting the loan facilitation sector have been introduced, the most impactful being the Notice on Strengthening the Management of Commercial Banks' Internet Loan Facilitation Business to Improve Financial Service Quality and Efficiency (《关于加强商业银行互联网助贷业务管理提升金融服务质效的通知》), effective October 1, 2025. This "Loan Facilitation New Regulation" sets baseline requirements for institutional准入 and cost caps. Although it directly targets commercial banks, it indirectly but powerfully constrains loan facilitation platforms through banks' partnership management responsibilities.

The Personal Loan Comprehensive Financing Cost Disclosure Regulations (《个人贷款业务明示综合融资成本规定》), effective August 1, 2026, further mandates that cost constraints be translated into verifiable disclosure obligations for borrowers.

Together, these three policies form a progressive constraint system covering:

• Access and cooperation
• Cost pricing
• Marketing channels

"This set of policies effectively declares the end of the industry's野蛮增长 phase," said Wang Pengbo, Chief Analyst at Botong Consulting. "Going forward, compliance and asset quality will be the core focus. Loan facilitation is no longer a simple traffic monetization business. Institutions must build implementable risk control systems that align with capital providers' demand for stable operations. Compliance capability will become the baseline for market competition."

Collapse of the Old Model

"This year has been really tough for us," said one industry insider. "Regulatory红线 are clearly drawn, and any non-compliant operation carries significant legal risk. Many of my peers have been summoned for talks, and quite a few have suspended operations to regroup."

Another loan intermediary added: "After the Measures take effect, even experienced players will disappear in droves. If you haven't entered the industry yet, don't bother."

Recently, multiple Notices (告知书) regarding standardized operations for loan intermediaries have circulated widely within the industry, drawing clear red lines against practices such as:

• Impersonating banks or other financial institutions for marketing and traffic generation
• Forging documents
• Illegal lending
• "AB loans" and predatory lending schemes

Wang Pengbo analyzed that the rights and responsibilities in loan facilitation are being redefined. "Loan facilitation institutions will return to their role as technology and channel service providers. Their focus will shift from simply reselling traffic to delivering risk control and operational capabilities. Meanwhile, capital providers will prioritize asset quality and compliance when selecting partners. The model of exchanging traffic for cooperation will become increasingly unsustainable."

He added: "In our observation, smaller loan facilitation institutions will face significantly greater difficulty in securing funding. Resources will continue to concentrate on leading institutions with robust risk control systems and completed compliance rectification. Platforms relying on high customer interest rates and marketing-driven customer acquisition will see their business scale shrink. Institutions lacking sufficient capital and technology to complete rectification will have to downsize or exit entirely. The industry's 'Matthew effect' will become more pronounced."

Another industry insider noted that while loan facilitation will not disappear, the industry is shifting from a "growth logic" to a "survival logic"—the beginning of a long-term restructuring. Previously, many companies operated on a model of "high pricing to cover risk, high conversion to dilute acquisition costs, and high turnover to scale up." That model is now failing.

Headline Performance Declines Across the Board

Even leading loan facilitation platforms have experienced sharp performance declines amid the regulatory tightening. According to Q2 2026 earnings reports, seven listed loan facilitation companies saw near-universal contraction in business scale, with profit declines far exceeding revenue declines. The原有盈利模型 is being systematically reassessed.

Business Scale (Q2 2026)

| Company | Loan Origination | YoY Change | Loan Balance (End of Q2) | YoY Change | |---|---|---|---|---| | Qifu Technology (03660.HK) | 633.77 billion yuan | -25.1% | 1,075.62 billion yuan | -23.2% | | FinVolution Group (FINV.N) | 410 billion yuan (China) | -19.3% | 654 billion yuan | -13.3% | | Xiao Ying Technology (XYF.N) | 116.3 billion yuan | -70.2% | 249.7 billion yuan | -61.5% | | Wei Xin Jin Ke (02003.HK) | 56.9 billion yuan (H1) | -85.0% | 77.3 billion yuan | -64.5% | | Jia Yin Technology (JFIN.O) | 95 billion yuan | -74.4% | — | — | | Lufax (06623.HK) | — | — | 1,673 billion yuan | -13.5% | | Lexin (LX.O) | 554 billion yuan | +4.8% | 937 billion yuan | -11.4% |

Only Lexin achieved growth in loan origination, up 4.8% year-on-year, though its loan balance still declined 11.4%.

Asset Scale

Except for FinVolution, whose total assets edged up 2.60% from the start of 2026, all other six companies saw declines:

• Xiao Ying Technology: -17.48%
• Wei Xin Jin Ke: -41.49%

Profitability (H1 2026)

| Company | Revenue | YoY Change | Net Profit (Attributable) | YoY Change | |---|---|---|---|---| | Qifu Technology | 74.76 billion yuan | -24.54% | 12.89 billion yuan | -63.52% | | FinVolution Group | 66.13 billion yuan | -6.31% | 8.57 billion yuan | -42.64% | | Lexin | 64.96 billion yuan | -2.92% | 3.03 billion yuan | -67.85% | | Xiao Ying Technology | — | -48.47% | 0.85 billion yuan | -91.39% | | Wei Xin Jin Ke | — | -61.23% | 0.12 billion yuan | -94.44% | | Jia Yin Technology | — | — | -2.45 billion yuan (loss) | — | | Lufax | — | — | -6.94 billion yuan (loss) | — |

Jia Yin Technology swung to a loss, with a net loss of 2.45 billion yuan in H1 2026 (including a 1.84 billion yuan loss in Q2 alone). Lufax reported a net loss of 6.94 billion yuan, compared to a loss of 5.19 billion yuan in the same period last year.

"Going forward, the overall profit margin of the loan facilitation industry will narrow," Wang Pengbo said. "Institutions will have to rely on精细化 operations and technological means to compress costs in order to preserve earnings."