Qudian, an online micro-lending company, went public on the New York stock exchange, opening at $24 per share on Wednesday morning.
It is a China-based company, founded by 34 year old Min Lou. The company provides small loans to China’s younger and under-served markets through its mobile app. The loan could be as small as 400 Yuan (about $60), that comes with a suitable loan period.
Founded in 2014, Qudian is one of fastest companies in history to hit $10b market cap. Today they officially go public on the NYSE pic.twitter.com/tCuObXVZxu
— NYSE (@NYSE) 18 October 2017
On Wednesday morning, the stock jumped to the height of $34 per share but then returned to $30 at the time of publication.
Reuters reported that the company offered $37.5 shares initially, and managed to raise $900 million from the IPO, making it the largest U.S.-listing by a Chinese company this year.
The company is backed by Alibaba, a Chinese e-commerce and technology company that was also listed on NYSE.
Carl Yeung, Qudian’s chief financial officer said that the firm is going after a market that China’s biggest banks can’t serve. He said that it is too expensive for larger financial services players to reach the hundreds and millions of modest-income Chinese. And Qudian is using nascent technology to capture that market.
“We are looking to use behavioral data, more and more data, to discover business opportunities,” said Yeung. “We are tracking the cutting edge data with artificial intelligence to see who has a high willingness to repay.”
By using such technology, the company is able to offer its clients higher credit limits without any fear.
According to reports, Qudian offered $5.6 billion in transactions to 7 million customers just in the first half of the year.
Qudian’s strong IPO defines the red-hot market for finetech in China.
Some of the world’s largest private financial technology companies are based in China. Like Lu.com, a Shanghai-based personal finance company, valued at $18.5 billion.
The Consultancy EY found out in a recent study that one in three digital consumers use two or more fintech products. EY stated that this indicates that fintech has crossed the threshold of early mass adoption. This adoption is being driven by emerging markets, like China and India.
“FineTech adoption by digitally active consumers in Brazil, China, India, Mexico and South Africa average 46%, considerably higher than the global average. From an individual market perspective, China and India have the highest adoption rates at 69% and 52% respectively”, Said the report.
The firm said that the emerging markets have higher fintech adoption rates due to large population of people who are underserved by the current financial infrastructures.
“Our five emerging markets are characterized by having growing economies and a rapidly expanding middle class, but without traditional financial infrastructure to support demand. Relatively high proportions of the populations are underserved by existing financial services providers, while falling prices for smartphones and broadband services have increased the digitally active population that FinTech target”, explained EY.
Mr. Carl Yeung said that this enviorment will create ways for many multi-billion dollar FineTech companies in China. And he hopes that Qudian would be among those companies.