The trading value of China's booming peer-to-peer platforms hit 250 billion yuan for the whole of 2014, doubling 2013's statistics. [Photo Provided to China Daily]

NANNING - The trading value of China's booming peer-to-peer (P2P) platforms hit 250 billion yuan ($41 billion) for the whole of 2014, doubling 2013's statistics, according to the Internet Society of China on Friday.

P2P online lending uses the Internet to conduct daily transactions or finance businesses. P2P platforms of this kind exceeded 1,600 in 2014 in China. December 2014 alone saw 47 newly-registered P2P platforms.

The new financing channel has helped break the strangle state-owned finance once held on those looking to back new businesses. It was estimated that 290,000 private lenders had invested via the P2P platforms.

In addition to convenience in capital utilization and low trading cost, online wealth management products allow users to avoid tight interest rate controls. Experts warned that with no regulations, the P2P industry is experiencing wild growth, and risks such as fraud, fund flight and illegal fund raising have emerged.

Professor Huang Zhen with the Law School of the Central University of Finance and Economics, said some platforms are actually run by loan sharks, who have moved online. However, the industry lacks big data management measures to monitor customers' credit and investors' losses.

The China Banking Regulatory Commission in September 2014 vowed to tighten regulations on P2P businesses, which includes new registration rules, requiring third party funds trusteeship and external audits.

The year ahead will be a tough test for surviving P2P lenders as a large number of online borrowing projects will mature. The implementation of the new rules will also trigger the first round of reshuffling in the P2P industry.