Fintech's meteoric rise, dramatic fall puzzle regulators on mainland

A friend of mine recently withdrew her investment from a peer-to-peer, or P2P, lending platform. What worried her was the high investment return the platform promised.

In an environment where the key market interest rate continues to drop amid a slowing economy, the platform still offers investors a return on investment as high as nearly 10 percent. "This doesn't look reasonable to me, so I took my deposit back," she said.

She is not alone. The online lending sector is seeing a wave of investor redemptions amid fears of rising defaults. As the economy slows, more P2P platforms are forced to shutter amid an intensifying regulatory crackdown on the scandal-ridden sector.