In recent years， internet finance， represented by online payment, peer-to-peer lending （P2P）， and equity crowdfunding， has been rapidly developing across increasingly diversified business forms， driven by the advancements in ITs such as big data， cloud computing， and mobile internet， and it has played an active role in reducing transaction costs， meeting diverse investment and financing needs and improving the efficiency，inclusiveness， and coverage of financial services. Internet finance is still， in essence， a form of finance and is， thus， not immune from the invisibility， infectivity， abruptness， and strong negative externality of financial risks. However,  due to its internet attribute,  such risks have a broader reach， higher diffusion rate， and stronger spillover effect. Currently,  various issues and risks are building up in the area of internet finance as it rapidly develops： Some business forms deviate from the right direction of innovation； some institutions have a weak awareness of the risks；some lack compliance， consumer protection， anti-money laundering， and anti-terrorist financing systems； and some institutions even engage in illegal fundraising， financial fraud， and other criminal acts under the guise of "financial innovation." In particular，some recent risk events have adversely affected the industry's reputation and drawn wide attention from Chinese society， resulting in a broad consensus for the need to regulate the development of internet finance.The CPC Central Committee and State Council attach great importance to internet finance development and risk prevention. In July 2015， the People's Bank of China，along with 10 ministries and commissions， promulgated the Guiding Opinions on Promoting the Sound Development of Internet Finance with the approval of the CPC Central Committee and State Council， establishing the overall requirements， principles，and duties for internet finance regulation. In December 2015， the Central Economic Working Conference required a special rectification campaign in internet finance to be carried out at an early date to regulate internet finance development. In October 2016， the General Office of the State Council promulgated the Implementation Plan for Special Rectification on Risks in Internet Finance， making comprehensive arrangements for the special rectification campaign in internet finance； the People's Bank of China and other relative departments also proposed implementation plans in their respective fields of regulation. These efforts reflect the foresight of the CPC Central Committee and State Council as all the chaotic phenomena and deformed developmental measures in the various business forms of internet finance need to be eliminated before a new order can be established. Industry self-regulation serves as a useful supplement of and strong support for administrative regulation as well as an important part of the innovative regulation process. To regulate the development of internet finance， establishing a management system that organically combines administrative regulation and industry self-regulation is a current consensus within the industry. It was in this context that the State Council approved the establishment of the Nationallntemet Finance Association of China （NIFA）.As a national self-regulatory organization，.NIFA assumes important responsibilities such as formulating internet finance management rules and industry standards， promoting business exchanges and information sharing among players， and establishing an industry self-regulation disciplinary mechanism. All parties look forward to the role played by NIFA. Currently,  at its emerging stage， internet finance takes on diversified forms and is full of innovations. The industry and academic community have published reports that explore internet finance from different perspectives， but they are not comprehensive，systematic， or objective enough. Comparatively， this report compiled by NIFA is focused on studying and discussing the reality of internet finance development in China based on the aggregate and sampling data from various business forms in 2015 and in terms of concept evolution and reform， development pattern， current development， difficulties and challenges， trends， and prospect， among others， using good and bad practical cases. This report can serve as a comprehensive and detailed reference for policymakers，professionals， and researchers and also help consumers gain knowledge of internet finance and systematically improve their risk awareness.Finally， I hope that the Chinese internet finance industry gradually builds up a positive reputation and continues to serve the development of the real economy and promote
　　financial inclusiveness.