(Yicai Global) Nov. 26 -- Cash-strapped Chinese bike sharer Ofo has denied misappropriating its users' deposits in peer-to-peer lending accounts after offering departing members investment products instead of their collateral back.

Ofo, officially Beijing Bikelock Technology, and the P2P platform in question PPmoney denied the accusation in a joint statement on Nov. 23, citing their relationship as a normal cooperation and noting that there is no obligation for users to invest. The pair also said they were pulling promotional offer that led to the accusations.

Many Ofo users have been attempting to get their CNY99 (USD14) security deposit back after several of the platform's suppliers filed lawsuits for moneys owed and the firm had to deny plans for bankruptcy. But when applying to get their cash back, Ofo offered them the opportunity to invest the money into a P2P lending product instead of taking their cash back -- sparking worries that the company was already embezzling deposits into such accounts.

The offer boasts about PPmoney's historical annual interest rate of 8 percent and a new investor bonus at the same rate, Tencent News reported on Nov. 23. There is a 30-day lock-up period, after which those who opt in will be able to withdraw their principal and awarded interest and bonus. The offer also enlarges the deposit value marginally to CNY100.

Both companies denied that PPmoney was paying Ofo CNY100 for each person who opts in to the program.

Editor: James Boynton