A report reveals the sheer size and growth rate of China's crowdfunding platform market.

There were 332 crowdfunding platforms in China at the end of April this year, having raised RMB11.424 billion ($1.72 billion) in money, rising 305 per cent from the amount raised in 2014, a report says.

The industry has expanded rapidly since the first platform was set up in China in July 2011, according to the China Internet Crowdfunding and Wealth Management Industry Report, 2016.

Among various kinds of crowdfunding, equity-based crowdfunding is favoured by capital. During 2014-2015, Internet companies, brokerages, insurance groups, equity transaction centres, and equity investment funds have sped up their layout in the equity-based crowdfunding field.

In 2015, private equity financing raised the most funds, amounting to RMB27.119 billion, and holding 54.79 per cent of the total expected funds; reward-based crowdfunding accounted for 42.24 per cent with RMB20.904 billion; public crowdfunding only occupied 2.97 per cent with RMB1.469 billion.

The rapid growth in such "alternative investment" platforms such as crowdfunding, and alternative lending channels such as peer-to-peer lending, has not been without problems in China. Recently, Guo Guangchang, the chairman of China's Fosun Group, the country's largest privately owned conglomerate, has called the country’s RMB440 billion peer-to-peer lending market “basically a scam”. The sector has been hit by scandal, with some platforms vanishing with billions of dollars lost. In February this year, more than 20 people were arrested for their involvement in Ezubao, a scheme that allegedly took more than RMB50 billion from investors. There have been severe losses at some other P2P schemes. The state regulator has banned online lenders from accepting deposits and capped borrowing at different levels for individuals and companies.