This study investigates the association between the expansion of formal finance through the opening of high-speed railway (HSR) and the risk of private lending in China, using data from China Judgments Online. The study employs a difference-in-differences approach and reveals that the cities connected by HSR have a greater risk of private lending and that the formal finance expansion leads to a cream-skimming effect on private lending. The HSR enhances the efficiency of product supply and pricing of formal financial institutions, which results in the expansion of banks. However, private lending relies heavily on social networks, which limits the direct effect of HSR on it. Consequently, the formal finance expansion facilitated by HSR has a significant cream-skimming effect on private lending, which increases the risk of private lending. These results make a significant contribution to the existing literature on the economic implications of formal financial expansion for private lending.