The Analysis of Asset-Backed Security Backed by Online Consumer Loan

Abstract

The "pause button" on Ant Group's dual listing in September 2020 attracted great attention from the fintech companies regarding their use of asset-backed securities (ABS) to lend huge amounts of money to consumers. Chinese regulators responded to this financial practice and introduced a series of regulations to minimize the potential risks of these lending activities and the adverse impacts on consumers. In this paper, the author explains how fintech companies use ABS to conduct their loaning activities, analyzes the risks presented in the industry, and introduces the corresponding policies and regulations.