In 2022, small loan institutions are experiencing “capital increase tide” and “retreat tide”.
As of January 21, the reporter found that eight Internet companies, including ant, Tencent, meituan, Jingdong, baidu (DU Xiaoman), Suning, 360 digital and byte beat, have increased capital for their small loan institutions. In addition, the local financial supervision and administration bureau is also accelerating the clearance process of unqualified small loan institutions.
Many industry insiders believe that small loan institutions will usher in strong supervision in 2022. If online small loan has the qualification of nationwide exhibition, it will be more consistent with the Internet attribute of giants.
capital increase small loan licenses of several Internet giants
Recently, Fuzhou 360 Security Technology Inc(601360) online microfinance Co., Ltd. (hereinafter referred to as “360 small loan”) under 360 digital technology has undergone industrial and commercial changes, and the registered capital has increased from 1 billion yuan to 5 billion yuan. According to the data, 360 small loan was established in March 2017 with an initial registered capital of 300 million yuan and increased its capital to 500 million yuan for the first time in 2017; In September 2021, the registered capital of 360 small loans increased from 500 million yuan to 1 billion yuan. The capital increase is less than half a year away from the last capital increase of 360 small loans.
Su Xiaorui, a senior analyst at Analysys, told the Securities Daily, “although the Interim Measures for online small loans are still in the stage of soliciting opinions, the follow-up strong supervision is a high probability event. The capital increase of 360 small loans twice in four months should be in line with the regulatory requirements and the trend of compliance development in the future.”
It is worth mentioning that 360 digital is not the first Internet platform in the industry to increase the capital of its small loan companies on a large scale. In recent years, many Internet companies have increased the capital of its small loan institutions.
Specifically, in December 2021, the registered capital of Chongqing Jingdong Shengji microfinance Co., Ltd., a subsidiary of Jingdong, increased from 3 billion yuan to 5 billion yuan; In August 2021, the registered capital of Chongqing meituan Sankuai microfinance Co., Ltd., a subsidiary of meituan, increased from 3.058 billion yuan to 5 billion yuan; In June 2021, the registered capital of Shenzhen Zhongrong microfinance Co., Ltd., a subsidiary of Shenzhen Zhongrong microfinance Co., Ltd., increased from 3 billion yuan to 5 billion yuan; In April 2021, the registered capital of Tencent’s Shenzhen TenPay online finance microfinance Co., Ltd. increased from 2.5 billion yuan to 5 billion yuan.
Earlier, in July 2018, the registered capital of Chongqing duxiaoman microfinance Co., Ltd., a subsidiary of duxiaoman, increased to 7 billion yuan; In October 2019, the registered capital of Chongqing ant small and micro loan Co., Ltd., a subsidiary of ant group, was increased from 8 billion yuan to 12 billion yuan; In April 2020, the registered capital of Chongqing Suning microfinance Co., Ltd., a subsidiary of Suning finance, was increased from 4 billion yuan to 6 billion yuan, etc.
For the capital increase of several giants, Wang Pengbo, a senior analyst of Broadcom analysis, told the reporter of Securities Daily that on the one hand, it is to meet the regulatory threshold of registered capital for cross provincial operation of national network small loans. It also shows that in the absence of other licenses, online small loan is still an important license for the compliant exhibition industry of the Internet financial platform, and with the help of small loan licenses, the Internet financial platform can also layout self-supporting businesses such as small and micro credit.
Yu Baicheng, President of the zero one research institute, told the Securities Daily, “Online small loans, especially national online small loan companies, are the development focus of the small loan industry in recent years and in the future. Under the regulatory requirements that financial business must be licensed, it is necessary for ecological Internet companies to obtain financial licenses if they want to deeply carry out credit financial business, among which national online small loan licenses become one of the choices.”
when clearing is in progress
small loan institutions are facing strong supervision
From the perspective of industry background, the small loan institutions under the capital increase of several Internet giants may be affected by the new online small loan regulations. In November 2020, the Interim Measures for the administration of online microfinance business (Draft for comments) (hereinafter referred to as the Interim Measures) was issued, setting access thresholds for shareholders, registered capital, business scope, platform qualification and other aspects.
In terms of registered capital, the interim measures require that the registered capital of small loan companies operating online small loan business shall not be less than RMB 1 billion, and shall be one-time paid in monetary capital; The registered capital of a microfinance company that operates network microfinance business across provincial administrative regions shall not be less than RMB 5 billion, and it shall be a one-time paid in monetary capital.
The above interim measures also give clear provisions on cross regional business, pointing out that during the transition period, small loan companies that have not obtained the operation qualification of cross provincial administrative region network small loan business shall control the balance and number of cross provincial administrative region network small loan within the stock scale, and orderly reduce and gradually clear. The transition period is 3 years from the date of implementation of these measures.
At the same time, with the deepening of the market rating system and the increase of regulatory requirements, unqualified small loan companies are being accelerated. For example, on January 4, 2022, Jiangxi provincial local financial supervision and Administration Bureau issued the announcement on canceling the pilot qualification of small loans of five companies in Nanchang, and the above-mentioned enterprises shall go through industrial and commercial cancellation or change according to law. According to the contents of the announcement, if new loan business occurs from the expiration date of the small loan business license, it shall be disposed of as illegal loan issuance.
In addition, according to the reporter’s incomplete combing, all provinces, cities and regions are accelerating the clean-up of non-conforming small loan institutions. Taking the external publicity data of Anhui local financial supervision and Administration Bureau as an example, the white list of microfinance companies in the province publicized at the end of December 2019 was 372. By December 20, 2021, there were only 236 white list data of microfinance companies in the province.
Su Xiaorui further pointed out that at present, the reshuffle of the small loan industry is indeed intensifying. Internet giants have increased their capital one after another, mainly to prepare for compliance. Only when the registered capital reaches 5 billion yuan, can the network small loan license have the qualification for nationwide exhibition; Secondly, the approval of consumer finance licenses slowed down in 2021. Many Internet giants chose to increase capital and online small loans on the basis of no consumer finance licenses; In addition, it is expected that the repayment of non-conforming small loans will still be accelerated in 2022. As the “capillary” of local financial business supporting the real economy, regional small loans have alienated some chaos in the development process. Therefore, it is necessary to carry out clean-up and rectification according to the current market situation and eliminate “old diseases”, which can also make the small loan industry develop healthily and sustainably.
