Xiaomi’s Zhuhai Mi Credit Instant Loan ends as the payday loan sector faces tougher test
(Yicai Global) March 12 – Zhuhai Mi Credit Instant Loan, the payroll provider of Chinese tech giant Xiaomi in southern Guangdong province, has disbanded as the microfinance sector shrinks due to stricter regulations.
Zhuhai Mi Credit was deregistered on March 7, and the once lucrative cash credit sector has plunged into recession, the National Business Daily reported yesterday.
Zhuhai Mi Credit was launched in August 2017 with a registered capital of CNY 300 million (US $ 44.6 million). Lei Jun, founder and CEO of Xiaomi based in Beijing, is the managing director of the credit department.
Chinese regional regulators have started curbing the wage lending sector, which targets both farmers and small and medium-sized businesses. Central Henan Province disqualified 18 unsecured lenders in January. The Sichuan Association of Microfinance announced last May that 25 affiliates were suspended for rectification and another 45 were disqualified.
The number of payday loan agencies declined annually by 5 percent, associated staff by 13 percent and outstanding loans by 24.9 billion daily report added. The slide continued for three consecutive years.
Editor: Emmi Laine