Following Alibaba and JD.com, another Chinese Internet giant Xiaomi has unveiled its financial services segment's big plan through a bet on the supply chain finance, which will benefit from its hardware manufacturing and sales ecosystem.
On October 18, 2020, Xiaomi's (01810:HK) financial service segment officially commenced operating under the new name 'Airstar Digits,' where the 'Airstar' comes from its Hong Kong-based virtual bank that launched in June 2020. The financial service specialized entity claims to have three major missions, in which it identifies the target customer groups: serving the financial needs of bricks-and-mortar businesses through fintech, serving financial institutions' industrial up-gradation, and serving for individual consumers.
Resembling Ant Group and JD.com (JD:NASDAQ) which have been developing financial services based on their parent companies' established e-commerce ecosystems and user pools, Xiaomi's financial services are destined to build upon its smartphone and IoT products manufacturing and retail process that involves enterprises covering electronic components, smart hardware, logistics and so on. From March 2018, Xiaomi financials claims to provide financial support for over 3,000 bricks-and-mortar businesses with over RMB 90 billion loans, reducing the financing cost of small-to-medium business by approximately 2%. Currently, the Airstar Digits is cooperating with financial institutions to further deliver financial services to enterprises in glass manufacturing, food processing, logistics, and textile industries.
Xiaomi's co-founder Hong Feng took the role of Airstar Digit's chairman and CEO. He says the renaming of Xiaomi finance to Airstar shows the company's commitment to empowering Chinese SMBs through digitalized financial services. Correspondingly, the consumer finance app that is operated under Airstar Digits will become Airstar app and continue to deliver loans, investment and insurance services to individual financial service users.