JD Digits Invests in a P2P Lending Platform to Complete Its Financial Sector
COVID-19 and China
Financial services on basis of fundamental business. Photo: Credit to JD Digits website

On April 11, 2019, several industrial and commercial modifications displayed on National Enterprise Credit Information Publicity System (国家企业信用信息公示系统) that Jinhaichaungzhuo (京海创卓), an affiliate company of JD Digits (京东数科), holds 100% shares of Yihuili (易汇利), the operating entity of P2P lending platform Yilidai (易利贷).

According to public disclosure, Yilidai was founded in 2104. The combined transaction volume adds up to 808 million, investor returns accumulated to 17.92 million. By March 2019, the balance of loans stood at 6.22 million, the accumulated loan amount is 6.08 million monthly, with an MAU of 3068 lenders and 59 borrowers.

JD Digits, the de facto controller of the P2P lending platform,  was formerly known as JD Finance. Its operational purpose is to connect finance and real industry by using digital technology, boosting the influence of the Internet.

The CEO Chen Shengqiang (陈生强) who seldom shows up in public, made his controversial speech on Boao Forum for Asia 2018 last April that JD Finance would no longer be involved in the financial business but should make its transition to a financial service company who can enhance the digital and intelligent development of industries, foster the development of the real economy and create greater social value.

Six months after this speech, Chen backpedaled on JD Digits’ Fifth Annual Meeting saying that financial and non-financial businesses will empower each other. Chen even provided further explanation for continuing to strengthen and expand the financial sector: Firstly, finance is its basic business and core competence basis for all other new sectors of the company. Second, financial business is an important source and support of its income and profit. Only with this foundation, can JD Finance invest in new business and make longer-term planning and layout.

On Nov. 20, 2018, JD Finance announced the major upgrade of its brand with the unveiling of JD Digits, indicating the company's drive towards integrating advanced digital technologies across more sectors. In addition to boosting the company's strength in fintech, JD Digits also sets out to target four other sectors including urban computing, agriculture, campus services and digital marketing.

Within those 7 months, CHEN’s speech vacillated from “no more financial businesses” to “core sector remain financial businesses”, then to its "brand escalation", even though it gains a clutch of influential backers such as Bank of China  and CICC Capital, we see the uncertainty and confusion of JD Digits.

JD Digits is vying with the likes of Du Xiaoman And Ant Financial to combine high-tech expertise with traditional finance and cater to a rising cohort of customers who prefer to do business online. 

The reason behind this new investment is because the financial license has always been a short slab of JD Digits. The number of financial licenses of JD Digits has not been as many as that of BAT (Baidu, Alibaba, Tencent) of the same camp. At present, JD Digits has many licenses on factoring, small loans, third-party payment, fund sales, insurance brokerage but lacks licenses on banking, securities, personal credit and consumer finance licenses which are more crucial in the financial market.

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