The most fertile land for the P2P industry is in China, not in the US or Europe, because the banks in China have so far kept tight controls over credit cards, and large sections of the private sector still find it hard to gain access to finance.

However, there is no FICO or a similar institution in China, and data on consumers and businesses are still patchy at best. Credit data (though incomplete) at the People's Bank of China are reserved for the banks, but are off-limits for the large numbers of shops and micro-lenders.

It is against this background that I am delighted to see China Rapid Finance (www.crfchina.com) exceed the high watermark of 2 million pieces of micro loans, taking advantage of Tencent's QQ user base. These loans are pre-approved, really small (500 yuan or 80 US dollars apiece), truly peer to peer in nature, and in full compliance with regulation.

This is a breakthrough. Most P2P operators in China are still making big loans (as big as millions of yuan apiece). Some securitize their big-sized loans through the internet. These are profitable - for now. But the holy grail of the industry remains matching small and diverse savers and borrowers, rather than scraping out a living in the banks' rubbish dump.