The outstanding loans of Weilidai (微粒贷), the short-term cash loan product available on Tencent’s messaging apps, had surpassed RMB100 billion (US$16 billion) as of the end of 2017, according to Tencent Q4 2017 earnings report. The non-performing loan ratio was low, said the company.
Weilidai is operated by WeBank, the direct bank in which Tencent has a 30% stake. Launched in 2015 on Tencent’s two social apps, Mobile QQ and WeChat, it’s available to users who are deemed creditworthy by the company’s own big data-based credit risk scoring engine.
The cumulative originations had surpassed RMB300 billion (US$ 47 billion) and total users exceeded 20 million in the first quarter of 2017, according to Wan Jun, COO of WeBank. Local media estimate that the cumulative volume had reached RMB400 million in 2017. (links in Chinese) An overwhelming majority of the loan capital is from partner banks.
The online consumer credit offerings of Ant Financial, the fintech arm of Alibaba, has surpassed RMB 600 billion (US$95 billion), Bloomberg reported earlier this month.
The major capital source for the two major consumer credit products Ant Financial offers is securitization. The company issued over RMB240 billion (US$ 38 billion) asset-backed securities in 2017.
The revenue growth of Tencent’s payment and financial services business in 2017 was driven by 1) consumer withdrawal fees, 2) fees from commercial transactions, 3) interest income and 4) finance offerings including Weilidai, according to Tencent management. The gross profit margin for this business segment increased in 2017. The company expects to invest aggressively in it in 2018.
Licaitong, Tencent’s online platform for personal investment products, aggregated over RMB300 billion (US$ 47 billion) assets under management as of the end of January 2018.
Offline payment transaction volume more than doubled year-on-year in 2017. The total volume of red envelope gifting, cash gift transfers among accounts on Tencent’s two messaging apps, decreased year-on-year but the overall money transfer volume increased year-on-year.