Xiaomi’s XWBank Crossed RMB100bn in Issued Loans in 20 Months

Online direct bank XWbank (aka. Sichuan Xinwang Bank) had reached RMB 100 billion in consumer loan issuance as of August 2018, only 20 months after its inception in December 2016, according to TodayCFC, a local news outlet focused on consumer finance.

Consumer lending is the bank’s major business that had originated a total of more than 30 million loans to 14 million borrowers as of May 2018. The average loan amount was about RMB3300. The delinquency rate is about 0.27%. The average APR is 18%.

The consumer loan product, named Haorendai (好人贷), is not only available on XWBank’s website and mobile app but also on a variety of Chinese online consumer lending platforms or mobile apps, including Ant Cash Now (the online cash loan product of Ant Financial), Didi (mobile ride-hailing), Lufax (marketplace lending), China UnionPay (interbank network), and Tencent.

Funds are mainly from local commercial banks.

Its in-house developed automated system handles over 99% of the loan originations and spends an average of 40 seconds to process a loan.

XWBank’s other businesses include enterprise banking and custody services for online lenders. (The Chinese regulator requires peer-to-peer lending platforms to use custodians and XWBank is one of the approved custodian banks.)

The bank began to turn a profit in the first quarter of 2018 that generated RMB 58 million, RMB 87 million and RMB 95 million in net profit in Q1, Q2, and Q3, respectively.

XWBank is the third direct private bank in China, after MyBank, affiliated to Ant Financial, and WeBank which is an affiliate to Tencent. Different from XWBank and WeBank, Ant’s MyBank has been focused on SME lending.

Source: WeBank, TodayCFC

Sichuan Silver Mi Technology, a wholly-owned subsidiary of Xiaomi Finance, holds a 29.5% stake in XWBank.

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