In 2023, the competitive landscape in the consumer finance sector has undergone drastic changes, with companies competing fiercely to stand out in the market.
Recently, a list of consumer finance company performance in 2023** has been circulated in the market, which contains relevant data of 28 consumer financial institutions except Home Credit Consumer Finance, CCB Consumer Finance, and Vipshop Fubon Consumer Finance. This ** may cover key performance indicators such as operating income and net profit of these companies, and provides market participants with a certain basis for comparison and analysis in the industry.
According to the verification of the 21st Century Business Herald, its relevant performance data is basically true.
In this fierce battle, Zhaolian Consumer Finance and Ant Consumer Finance performed more prominently, while other companies are gradually adapting to this industry change and looking for their own development paths.
Profit PK big race.
Against the backdrop of restricted diversion policies and difficulties in self-operated business development, the performance of consumer finance companies has attracted much attention.
Among them, Zhaolian Consumer Finance relied on a net profit of 3.6 billion yuan, 1960.2 billion yuan of operating income and 1764With total assets of 2.1 billion yuan, it is firmly in the leading position in the industry.
Ant Consumer Finance's performance in terms of total assets and operating income is particularly eye-catching. Although its net profit is only 15.2 billion yuan, compared with Zhaolian's 3.6 billion is insignificant, but its 862.9 billion operating income and up to 2396The total assets of 6.9 billion yuan, but the net profit is only 15.2 billion yuan.
Overall, a new pattern has been formed among the 28 consumer finance companies that have released financial data, and in addition to Ant Consumer Finance, which is the industry leader, other leading companies include Zhaolian Consumer Finance, Industrial Consumer Finance and Instant Consumer Finance.
Although the total assets of immediate consumption and industrial consumption are less than 100 billion, the profitability was outstanding in the first half of the year. Immediately consumer finance last year's half-year revenue of 13500 million yuan, with a total revenue of 19 in 20238, earned 6 in the second half of the year300 million yuan, less than half of the first half of the year. Immediately, consumer finance has strong momentum in asset management and market expansion. It is reported that its off-balance sheet assets have even reached saturation and have to seek cooperation with other companies in the industry to undertake its spillover assets.
However, there are certain risks associated with IB Consumer Finance. According to Blue Whale Finance, the risk profile of IB Consumer Finance has deteriorated significantly since the second quarter of 2023, and its overdue rate has increased by about 60% since the beginning of last year compared with the previous high. Industry executives also mentioned that the risks faced by IB Consumer Finance appeared earlier than the consumer finance industry as a whole. At the same time, there are frequent changes in the senior management of IB Consumer Finance, which indicates that IB Consumer Finance may be facing greater operating pressure.
It is worth noting that the net profit of Hangzhou Bank Consumer Finance and Changyin 58 has increased significantly, surpassing that of China Post Consumer Finance. The net profit of Hangzhou Bank Consumer Finance in 2023 is as high as 80.2 billion, and the total assets also grew rapidly to 4961.7 billion.
In the market segment, Hangzhou Bank Consumer Finance and Changyin 58 Consumer Finance have opened up new market space by deeply cultivating offline business. The offline team of Hangzhou Bank Consumer Finance has been widely rolled out, covering Gansu and other regions, and its account managers and advertisements can be seen on the streets and alleys, which has effectively enhanced the market influence of the brand. Changyin 58 Consumer Finance focuses on new citizen groups, such as delivery workers, truck drivers and other customer groups that are less commonly involved in traditional banking services, and this strategy has also achieved good results. It is worth noting that although it is generally believed that the risk of lending to white-collar groups such as employees of state-owned enterprises is relatively low, in fact, the overdue and bad debt rates of new citizens are not much different from them.
With the help of Ping An Puhui's advantages, Ping An Consumer Finance Company has risen rapidly, with total assets of 40.5 billion yuan and net profit of 4.5 billion yuan by the end of 2023900 million. The rapid rise of Ping An Consumer Finance is largely due to the high-quality assets inherited by Lujin. Benefiting from the transformation of Lufax, a subsidiary of the Group, Ping An Consumer Finance actively undertook high-quality assets and achieved rapid growth through the issuance of consumer loans. According to the company's announcement, the balance of consumer loans in the third quarter of 2023 accounted for about 10%, and the proportion of new loans was as high as 41%.
Harbin Consumer Finance performed well in the performance report, with a net profit of 1400 million yuan, operating income 123.3 billion yuan, with total assets of 2137.4 billion yuan. On the face of it, the company appears to be compliant with regulatory requirements and only conducts lending business with an annual interest rate of no more than 24%. However, according to industry sources and the report of "Gold Content", Harbin Consumer Finance may continue to engage in high-interest loan business through some workarounds, which is regarded as an ingenious "unspoken rule operation" in the industry.
In 2023, CITIC Consumer Finance's financial performance was relatively stable, achieving 11.8 billion yuan of net profit and 70.3 billion yuan of operating income, total assets reached 1104.3 billion yuan.
In 2023, Nanyin BNP Paribas Consumer Finance (formerly known as Suning Consumer Finance) achieved 1The net profit of 1.1 billion yuan and the operating income reached 263.3 billion yuan, with total assets of 33.4 billion5.9 billion yuan. It is worth noting that Bank of Nanjing and Bank of Ningbo, two leading city commercial banks, have entered the field of consumer finance, bringing new vitality to Nanyin BNP Paribas Consumer Finance and Ningbo Consumer Finance (formerly known as Huarong Consumer Finance) respectively.
In 2022, CB BNP Paribas Consumer Finance experienced a significant change in shareholder structure, a change in the company's name, and an increase in capital. These changes have led to an increase in the company's performance in 2023.
The 2023 report card of Ningyin Consumer Finance shows that the operating income is 180.2 billion yuan, with a net profit of 20.2 billion yuan, with total assets of 4534.2 billion yuan, with a net profit margin of 1121%。Formerly known as Huarong Consumer Finance Company, Bank of Ningbo successfully acquired 70% of the equity of the original Huarong Consumer Finance Company through auction in December 2021, and announced on August 5, 2022 that it would be renamed Ningyin Consumer Finance Company.
The performance shows that the net profit of five licensed consumer finance companies, including Shengyin Consumer Finance, Xiaomi Consumer Finance, Jin Meixin Consumer Finance, Jinshang Consumer Finance, and Mengshang Consumer Finance, is less than 100 million yuan. Among them, Shengyin, Jin Meixin Consumer Finance, Jinshang Consumer Finance, and Mengshang Consumer Finance have assets of less than 10 billion yuan.
In 2020, Xiaomi's consumption has been "tepid". Since its establishment, Xiaomi Consumer Finance has not seen explosive growth in its business, despite having a huge fan base. Xiaomi's consumer finance business, which can be promoted and marketed using its large user base and its own app platform, should have been a strong driver of its growth. However, it seems that its online self-operated business has shrunk, and the company's pace of development is not rushing. In 2023, the net profit of Xiaomi Consumer Finance will be 07.6 billion yuan, operating income reached 68.5 billion yuan, and the total assets are 1641.6 billion yuan.
Seven consumer finance companies were fined.
However, at a time when major consumer finance companies are demonstrating their skills in the market, compliance issues have become a challenge that cannot be ignored.
A few days ago, the statistical analysis of Xinhua Finance and Bread Finance revealed the problems existing in the industry. In 2023, the regulator issued a total of 8 fines involving 7 institutions, and the amount of fines confiscated exceeded 3.69 million yuan, which is a decrease from 2022, but still highlights the importance of industry compliance.
These data not only reflect the competitive situation in the market, but also reflect the strict requirements of the regulatory authorities for the standardized operation of the industry.
Xinhua Finance and Bread Finance conducted a statistical analysis of the violation penalty data of related companies, and looked at the compliance status of licensed consumer finance companies from the perspectives of the number of fines and the amount of fines.
In terms of the amount of penalties imposed on a single consumer finance company, Immediate Consumer Finance and Changyin 58 Consumer Finance are in the leading position, with fines of 1 million yuan and 750,000 yuan respectively, both exceeding the 700,000 yuan mark. The two companies received the highest penalties for violations of any of the fines.
Specifically, the immediate consumer finance was fined 1 million yuan for problems such as lax review and imprudent management of outsourced collection cooperation institutions. Changyin 58 Consumer Finance was fined 750,000 yuan for inquiring about personal information without consent.
In addition, consumer finance companies initiated and established by commercial banks have also been punished by the regulatory authorities for business violations. The fines of Hangzhou Bank Consumer Finance and Harbin Bank Consumer Finance both exceeded 500,000 yuan. Hangzhou Bank Consumer Finance was fined 550,000 yuan for inadequate management of outsourced collection and inadequate implementation of the loan interest rate risk pricing mechanism. Harbin Consumer Finance was fined 580,000 yuan for violating the relevant regulations on credit management.
These figures reflect the strict compliance requirements of regulators for consumer finance companies and the high pressure on non-compliance. On December 18, 2023, the full text of the Measures for the Administration of Consumer Financial Companies (Consultation Draft) revised by the State Financial Supervision and Administration was released for public comment.
With the increasing importance of the state to the consumer finance industry, the relevant regulatory policies are also constantly improving and strengthening. From the entry threshold to the risk management in the operation process, to the protection of consumer rights and interests, all links are particularly important.
Judging from the trend, the regulatory framework of the consumer finance industry will be more complete in the future, and the regulatory requirements will be more stringent. This is both a challenge and an opportunity for companies in the industry.
For licensed consumer finance companies, strengthening internal management and strict compliance with laws and regulations are necessary conditions for their sustainable and healthy development. At the same time, it also suggests that the industry as a whole needs to continuously improve its level of compliance to avoid regulatory penalties, protect consumer rights, and maintain the stability of financial markets.
Other players rethink their way to survive.
In 2023, Ant Financial will return. Tianyancha APP shows that Ant Technology Group's shares*** hereinafter referred to as "Ant Group") have undergone industrial and commercial changes, and the registered capital has increased from about 23.8 billion yuan to 35 billion yuan, an increase of about 47%.
In response, Ant Group replied that the capital increase was made by Ant Group in accordance with relevant regulatory provisions and the company's business development needs. Ant Group has increased its registered capital to reserve more space for the company's subsequent development. The change in registered capital comes from the conversion of capital reserve into share capital, and the company has not carried out market-oriented financing, and there are no new investors.
Ant Group was founded in October 2000, and in March 2013, Alipay's parent company announced that it would establish a small and micro financial services group with it as the main body, and small and micro finance became the predecessor of Ant Financial. In July 2020, Ant Financial officially changed its name to Ant Group, with Jing Xiandong as its legal representative. Shareholder information shows that the company's largest shareholder is Hangzhou Alibaba Network Technology***
In 2020, Ant Group submitted for an IPO. Its financial products "Huabei" and "Borrow" are co-lending models mentioned in their prospectuses. Under this model, Ant Group usually contributes only a small portion of the funds, and most of the funds are provided by partner banks, and Ant Group undertakes the functions of customer assessment and risk control through the technology platform.
Indeed, Ant Group planned to conduct an IPO in 2020, but the IPO was eventually halted due to changes in the regulatory environment. There are two main reasons for this.
First, although Ant Group offers a range of businesses in the financial services sector, including payments, lending, insurance, and wealth management, it chose the technology sector when applying for listing, which is seen as an attempt to circumvent stricter financial regulations, raising concerns among regulators.
On the other hand, Ant Group has rapidly expanded its borrowing scale to more than 300 billion yuan through bank loans and asset-backed (ABS) issuance, with a leverage ratio of up to 100 times. This highly leveraged operating model can pose a threat to the stability of the financial system.
Subsequently, Chinese regulators began to strengthen the supervision of Internet financial enterprises, especially the syndicated loan business.
On the evening of November 2, 2022, the People's Bank of China (PBOC) and the China Banking and Insurance Regulatory Commission (CBIRC) jointly issued the Interim Measures for the Administration of Online Small Loan Business (Draft for Comments). The Draft clarifies that microfinance companies are not allowed to operate across provinces, and stipulates that, in principle, the balance of single-family online microloans to natural persons shall not exceed 300,000 yuan, and at the same time, the Draft also limits the upper limit of the financing leverage of online microfinance institutions. First, the balance of a single-family online microloan for a natural person shall, in principle, not exceed RMB 300,000 and one-third of his or her average annual income in the last three years, and the lower of these two amounts shall be the maximum loan amount.
The Measures for the Supervision of Internet Small Loans stipulate that in joint loans, small loan companies must contribute at least 30% of the capital, which significantly increases the risk assumption of Internet platforms themselves in the loan business.
Subsequently, Ant Group made a series of adjustments to its financial business, including applying for an internet microloan license and transferring some of its business to licensed financial institutions.
What cannot be ignored is that Ant Consumer Finance has made strategic adjustments on the Alipay platform in recent years. Since 2021, it has effectively concentrated its traffic and resources on its own borrowing and Huabei businesses by reducing cooperation with other consumer financial institutions and implementing measures such as limiting flow, deducting points, and removing financial ecological partners. This strategy has undoubtedly strengthened Ant's own competitive advantage in the consumer finance sector, clearing the market environment for its borrowing business and concentrating resources in the hope of gaining a larger market share.
This shift in strategy can be said to be an all-out internal integration for Ant Consumer Finance. By reducing its reliance on external cooperation, Ant Consumer Finance is not only able to better control its own risks and user data, but also to attract more potential customers for products such as "Borrow" and "Huabei" through the huge traffic and entrance of Alipay.
While Ant is getting bigger and bigger, the market share is surging, and the strategic adjustment is also putting pressure on other consumer finance companies. When a platform company with a huge user base and traffic advantage begins to "work behind closed doors", other players must rethink their own ways of survival. This is not only a battle for capital and resources, but also a test of innovation and adaptability.
Due to the strict restrictions imposed by the regulatory authorities on the diversion channels of financial products and the increasing difficulty of carrying out self-operated business in the market, many consumer finance companies have encountered considerable resistance in expanding customers and increasing business volume.
In the consumer finance industry in 2024, the phenomenon of asset shortage is becoming more and more serious, which has brought huge challenges to the development of the industry. Against this backdrop, the differentiation within the industry is beginning to become particularly pronounced. On the one hand, consumer finance companies that perform well usually increase their marketing efforts and invest a lot of money to attract users and maintain and expand their market share. On the other hand, companies with weaker financial strength rely more on loan assistance to attract customers, trying to ease the financial pressure through cooperation. This polarized pattern indicates that the industry will become more competitive in the future, and also hints that the industry may experience a series of consolidation and reshuffle. For consumer finance companies, how to find new growth points and profit models in such an uncertain environment will be a big test for them.