'China can tackle online finance fraud through innovation, technology'

LendIt, the world's largest conference organizer for the online finance industry, said on Tuesday that the industry is set to rebound despite challenges created by rising investors' skepticism.

China has seen a flourishing online finance business or better known as peer-to-peer lending as many technology firms have taken advantage of the internet and mobile technology to offer loans and financial services to small businesses and consumers.

But the rising fraud and irregularities, including the Ezubao incident, have turned investors skittish toward the emerging industry.

"A lot of things have happened that have challenged the industry but the fundamental and the pace is still there," Jason Jones, the president of LendIt, said at a news conference in Beijing.

Jones said that China must deal with fraud and it has the ability to address the problem though innovation and technology involving big data.

LendIt will hold its first China conference on July 17 and 18 in Shanghai and more than 1,000 foreign and Chinese players in the online finance industry are expected to attend.

The event will focus on operational infrastructure, regulation and compliance.

The global online finance industry was plunged in crisis after Chief Executive Renaud Laplanche of Lending Club, the largest US online finance firm, resigned on Monday over irregularities in its lending business. The resignation sent the firm's share price down by 35 percent on that day.

Jones said that the incident was a blow to the global online finance industry and the lesson is that firms have to act with integrity as the industry deals with other people's money.

"Fintech companies must continue to invest in their operational infrastructure and implement best practices around compliance," he said.