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China's big P2P platforms shrug off crackdown

(Updates byline)

By Elzio Barreto and Sue-Lin Wong

HONG KONG/BEIJING, Aug 25 (Reuters) - China's bid to tame its peer-to-peer (P2P) lending sector could cost smaller platforms some business, but the impact on larger players will be limited, and some of the new restrictions will be hard to enforce, analysts and industry players said.

Regulators unveiled a series of measures on Wednesday night to head off signs of rising risks in its fast-growing P2P market, including borrowing limits and forcing P2P platforms to use third-party banks as custodians of investor funds.

China's P2P and online finance industry has boomed in recent years, but growth is slowing after a series of scandals and multi-billion dollar failures.

The regulator's announcement knocked 22 percent off the New York-listed shares of Chinese P2P lender Yirendai Ltd overnight, while Chinese stocks fell to a two-week low on Thursday, weighed by banking shares on concerns over the crackdown on riskier lending practices.

But many larger P2P companies including Lufax, Yirendai, PPDAI and, say they already comply with many of the new requirements, so could benefit...