Only one out of the nine peer-to-peer lending companies in China might be able to survive as top financial regulators are stepping up the pace of scrutiny to curb risks caused by the massive unregulated sprawl in the past few years.

The central government plans to maintain “pressing posture of severe attack” to clamp down on activities violating laws and regulations in internet finance, extending the ongoing nationwide crackdown for another year, Pan Gongsheng, deputy governor of the People’s Bank of China, the central bank, said during a meeting on July 9.

The two-year cleanup of the industry was necessitated by a series of scandals that saw investors lose huge amounts of money.

His comments echoed earlier remarks by Sun Guofeng, head of the research institute of the central bank, who warned that financial risks are now spreading from traditional sectors to the emerging fintech sector, increasing the risks associated with online cross-region loan operations.

“Regulators at local levels should adopt new technology such as cloud computing to enhance capabilities in protecting against and resolving cross-market financial risks,” he said, during the Bund Summit on Fintech held over the weekend.

Having witnessed growth at breakneck pace for years, large number of peer-to-peer lending companies have reaped profits as the nation has “no appropriate regulation in place,” according to Huang Yiping, head of institute of digital finance of Peaking University.

Many companies may find it hard to survive in the coming months amid the strong push to clean up the sector coupled with pressure from the recent liquidity crunch and an expected large amount of withdrawals.

But some experts consider such a scenario expected and normal.

“The number of companies may shrink to only around 200 to 300,” said an expert with a leading internet finance institute, who preferred to remain anonymous.

Of the more than 6,000 online lending platforms, only around 1,800 were still in operation at the end of June, according to Online Lending House, an online lending data provider.

Internet finance will remain a feasible option to match investors and borrowers, but there should be a transition after the industry expanded at fast pace for long, according to Tang Ning, CEO of CreditEase.

“Investors should also make a switch while making investments－from past addition to short-term, high yielding products to building long term, balanced portfolios,” he said.