Deployment in Non-standard Financial Assets by Investing in 91wutong
On January 18, JD Capital, along with Tongxin Securities and AV Capital, announced the A-round investment in China’s first P2P platform for financial assets—91wutong.com.
Launched in late June 2014, 91wutong is the first P2P lending platform that adopted a pledge financing model with non-standard financial assets. Non-standard assets include collective trust plans issued by trust companies and collective asset management plans issued by securities/funds companies. The platform mainly targets high-net worth and institutional clients with a threshold of 1 million yuan. The new model could not only vitalize existing non-standard financial assets, thus improving the liquidity of asset owners, but lower the investment threshold, allowing more investors to enjoy high investment return.
With risk control being the key indicator for the sustainability of P2P platforms, 91wutonng has created a unique system featuring strict standards and stringent processes. The trust plan developed by 91wutong and the funds subsidiary’s evaluation system could best protect investors’ interests. Based on factor analysis of the historical risk records of trust products, the system verifies fund raiser’s qualification, credit enhancement measures, project quality and issuer; by learning from other financing institutions like E&Y PTI, it provides 6 rates (from AAA to D) for project development (10 preliminary assessment indicators and 30 re-evaluation indicators). By far, the overdue rate of 91wutong’s products is zero.
According to 2014 China White Paper of P2P Lending Industry, the number of P2P lending platforms in China exceeded 800 in 2013 with a gross merchandise volume of 200 billion yuan (online: 110 billion yuan; offline: 70 billion~80 billion yuan), implying a 8-time growth from 2012. Over the next two years, P2P is expected to maintain a strong momentum. Although an emerging industry, P2P has already become a much-welcomed attraction for all types of capital. The investment in 91wutong marked JD Capital’s entry into the Internet finance.
According to the financing plan, proceeds from the A-round financing will be used for risk control system, IT upgrading, product development, client expansion and talents recruitment.