Online loan risk insurance | Deposit quantitative solution is a premise, what are the possible transformation of online loan institutions to licensed
For more than four years of special rectification of P2P online loans, "clearance" has become the mainstream.
According to the latest official data, as of March 31, 139 online lending institutions were actually operating nationwide. For these institutions, either "death" completely or transform into survival.
Transformation, where to turn? How to turn?
In January 2019, the regulatory department issued the "Opinions on Doing a Good Job in the Classification and Disposal of Online Lending Institutions and Risk Prevention" (Circular 175), stating that it is necessary to clean up illegal and illegal businesses without leaving hidden risks. Actively guide some institutions to transform into online micro-loan companies, loan-assistance institutions or diversion for licensed asset management institutions. On November 27, 2019, the "Guiding Opinions on the Pilot Transformation of Online Lending Information Intermediaries into Microfinance Companies" (Rectification Office Letter [2019] No. 83, referred to as No. 83) was released. According to the then Department of Inclusive Finance of the Banking and Insurance Regulatory Commission Director Li Junfeng said that some institutions with strong capital strength, a certain financial technology foundation and good internal control capabilities have promoted their active transfer to online micro-loan companies, and individual eligible ones can also be converted to licensed financial institutions for consumer finance.
So, how is the transformation of online loan institutions now?
The quantitative solution of online loan business is the first step
For online lending institutions that want to transform, the current pressure drop in P2P business stocks is the first step.
Chen Wen, director of the Digital Economy Research Center at the School of Finance, Southwestern University of Finance and Economics, told the surging reporter: "If the P2P loan balance is not digested very well, the transformation will be difficult to succeed."
This year is the ending year of Internet financial risk management. According to the video conference on the Internet finance and online lending risk special rectification work held in April, as of March 31, 2020, there were 139 online lending institutions (hereinafter referred to as online lending institutions) actually operating in the country, down 86% from the beginning of 2019 ; The balance of loans decreased by 75%; the number of borrowers fell by 80%; the number of borrowers fell by 62%. The number of institutions, the scale of loans and the number of participants have declined for 21 consecutive months.
A person familiar with the matter revealed to Peng Mei reporter that Shanghai plans to complete the clearing of P2P stock business by the end of the year. Every month, the government will interview companies that still have P2P business, and complete the pressure drop work according to the monthly given indicators.
The person familiar with the matter said that at present some online lending institutions will use coupon coupons to encourage borrowers who do not want to withdraw their loans in advance to settle the payment in advance, and encourage the owed person to repay in advance, and even reduce a part of the profit margin.
Prior to this, Zhang Feng, CEO of Xinye Technology, said in an interview that most of the funds on the fund side of Xinye Technology before the transformation came from individual investment users. The strategic transformation was initiated in the second half of 2018.
"It took more than a year, after October 2019, the transaction amount facilitated by the platform has been provided by institutional partners." Zhang Feng said.
Is the license a "pass"?
After the issuance of Circular 175, the relevant licenses that can help online lending institutions to carry out online small loan, loan assistance and diversion services have ushered in the peak season of demand, and the licenses have become an indispensable passport for the successful transformation of online lending institutions.
The above-mentioned industry insiders said that online lending institutions obtain licenses, in fact, more often through acquisitions, or apply for related business licenses during the transformation process, "However, this path of transformation (application) is unlikely."
He believes: "The current main layout direction or acquisition direction, starting in the past two years, one is the online small loan national exhibition industry (license), and the other is related to the loan business. This business chain may require financing guarantee (license) ."
It is understood that when mutual financial companies have transformed and cooperated with banks, trusts, consumer financial companies and other financial institutions to develop loan assistance services, financial institutions generally require mutual financial companies to provide guarantees in order to control risks. Therefore, the financing guarantee license is a necessary license for mutual financial institutions to develop loan assistance business.
In fact, a number of mutual gold platforms listed on US stocks have already obtained financing guarantee licenses, such as Jiayin Jinke (NASDAQ: JFIN), Xinye Technology (NYSE: FINV), Lexin (NASDAQ: LX), Xiaoying Technology (NYSE: XYF), Fun Store Group (NYSE: QD), 360 Finance (NASDAQ: QFIN), etc.
Online microfinance and consumer finance are the main directions for the transformation of online loan institutions.
"This is because the asset end of the online loan business model in the past is more similar to online small loans and consumer finance, with a similar target customer group, similar asset quality, and similar methods of customer acquisition, risk control, and operation." Surging News said.
Another industry insider told Peng Mei News that current Qudian, PPmoney, Yirendai and other companies have online small loan licenses. There are also companies similar to Jiayinjinke that hold online microloan licenses through affiliated companies.
There are also online loan institutions directly transformed into small loan companies.
On November 27, 2019, the "Guiding Opinions on the Pilot Transformation of Online Lending Information Intermediaries into Microfinance Companies" (Circular 83) was issued, stating that online lending institutions should be transformed into small loan companies with clear capital requirements. The capital requirement for small loan companies must be paid-in monetary capital. Among them, the registered capital of small loans operated by a single provincial level is not less than 50 million yuan; the registered capital of small loans companies operated nationwide is not less than 1 billion yuan; and the first period of paid-in monetary capital is not less than 500 million yuan. Not less than 1/10 of the loan balance of online loan institutions during the transition.
According to the official website of Xiamen Local Financial Supervision and Administration Bureau, on May 13, the Xiamen Local Financial Supervision Bureau issued two notices on the transformation of P2P online lending companies into small loan companies, agreeing to the Xiamen Yuzhou Qihui Internet Lending Information Intermediary Service Co., Ltd. (hereinafter referred to as "Yuzhou Qihui") and Xiamen Dolphin Financial Network Technology Co., Ltd. (hereinafter referred to as "Dolphin Financial") transformed into a single provincial-level micro-loan company, which means that these two P2P The organization was officially approved to transform into a small loan company.
However, Chen Wen believes that at present, some policies on the leveraged supervision of online micro-loans are not very clear. From the current practical point of view, it is difficult to support the transformation of head P2P institutions.
More powerful P2P online lending institutions can also directly apply for consumer finance licenses. For example, in April 2020, Ping An, a subsidiary of China Ping An, established the Ping An Consumer Finance Company (Ping An Consumer Finance) and obtained a consumer finance license approved by the China Insurance Regulatory Commission.
On June 30, Ping An Consumer Financial released its first personal revolving consumer credit loan product "Ping An Little Orange Blossom" in Shanghai, integrating loan and payment functions.
In addition to Ping An Consumer Gold, Lexin's current major products such as "Le Card" and "Instalment Le" also focus on consumer finance.
However, in the specific transformation process, the transformation aimed at a single business is not common. More online loan institutions are multi-faceted and apply for various licenses at the same time to obtain compliance management rights.
Access to institutional funds
Licensed, in addition to compliance operations, the ultimate goal is to obtain institutional funds.
An industry insider told the surging news reporter that getting a license is actually recognized to some extent, which can increase the negotiation cost when obtaining institutional funds.
How to get more institutional funds? Another industry insider believes that accelerating cooperation in loan assistance business and increasing the proportion of institutional funds are, in the final analysis, to solve the shortcomings and deficiencies of licensed traditional financial institutions in the field of consumer finance, and help them solve customer acquisition, risk control, operations, The pain point after loan. Behind this is the need to work on customer acquisition channels, asset quality, risk control capabilities, post-loan management, etc.
According to the industry sources, only the head platform has completed or nearly completed 100% of the institutional funds, but it is not excluded that some institutions with huge online loan business have just begun to explore the transformation.
The road is long, and the transformation of online loans is a long way to go.
"I personally think that apart from the first few companies, some started to transform very early, but I don't think others will work. Most of the online loan institutions have no transformation, so they ended their mission and quit it. The historical stage." The industry insider said.
Chen Wen believes that the biggest value of China's online lending industry lies in the cultivation of a group of online financial management customers and online borrowing customers. In this era of financial technology after the rectification of Internet finance, in fact, it is more a camp of powerful players.
He pointed out that online loan assistance, such as Tencent, Alibaba, 360, Baidu and Toutiao, are all deploying loan assistance to help financial institutions acquire customers. From the perspective of online traffic, (Internet companies) have certain advantages, but also have relatively strong data strength, such as helping banks make wallets.
So, is there any possibility for online loan institutions to file?
"It's basically impossible," Chen Wen said. "The possibility of P2P filing is getting lower and lower. For the remaining platforms, embracing supervision and rectification and actively transforming into a pragmatic move."
(This article is from Surging News, for more original information, please download the "surging news" APP)
News reporter Ye Yinghe