(Yicai Global) Feb. 8 ---"Regarding the regulation of deposit of shared bikes, China's Ministry of Transport, People's Bank of China, and China Banking Regulatory Commission, have made a preliminary plan after investigation. They have also solicited opinions from bike-sharing firms and urban management departments. The document has basically been completed and will be promulgated soon," Liu Xiaoming, China’s vice transport minister, said at a press briefing yesterday.
In the past two years, some 77 bike-sharing firms have operated in the country. They have as of now deployed 23 million bicycles with 400 million registered users taking more than 17 billion trips. At the peak, some 70 million trips were made per day, statistics show.
The collapse of bike-sharing firms caused user deposit losses of more than CNY1 billion last year, statistics from Zhima Credit, a subsidiary of Ant Financial Services Group of Chinese internet behemoth Alibaba Group Holding Ltd., show. Large bike-sharing firms hold hundreds of billions of yuan in user deposits. Once they fold, the impact is thus widespread.
MOT, together with 10 departments, promulgated guidelines on encouraging and regulating the development of Internet bike rental services in August. The guidelines propose three possible ways to deal with the deposit problem. The first is renting bicycles free of deposit, using credit instead. The second is taking a deposit when a bike is rented and refunding it right away after the bike is returned. Third, if a bike operator requires a deposit, it should establish a dedicated account subject to government supervision and regulation to ensure the security of the funds.