MYbank, a leading online private commercial bank under Ant Group, today announced a five-year plan to reach more small and micro enterprises (SMEs) across China via supply chain finance and rural lending.
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The number of SMEs served by MYbank increased more than tenfold in five years (Graphic: Business Wire)
The five-year plan details MYbank’s aspirations to work with partners across multiple sectors to better serve SMEs across China. Key measures and initiatives MYbank will implement as part of the plan include:
- Leveraging supply chain finance to support 10 million SMEs who traditionally have been unserved or underserved in the market.
- Working with 2,000 county and village managers to provide rural lending to SMEs in need.
- Collaborating with financial institution partners to distribute interest-free vouchers for business loans totaling RMB 300 billion.
- Serving 40 million female business owners and providing them with more economic opportunities.
“Through this five-year plan, we look forward to working with more financial institution partners to realize our shared vision to make financial services more accessible for SMEs,” said Xiaolong Jin, President of MYbank. “In the past, SMEs had to go through a one-way application approval process when they came to us for lending services. By working with our partners and embedding our services seamlessly into use cases such as supply chain finance and rural lending, we hope to bring our services to SMEs across a wide spectrum of industries.”
Established on June 25, 2015, MYbank is one of the leading private online commercial banks in China focused on serving SMEs and farmers. It was the first bank in China to establish its core banking system entirely on the cloud without any physical branches. Leveraging Ant Group’s AI, computing and risk management technologies, MYbank also pioneered the “310 model” for SME financing, which offers collateral-free business loans that take less than three minutes to apply for on a mobile phone, less than one second to approve, and requires zero human intervention. SMEs in China supported by the “310 model” have shown resilience during the COVID-19 pandemic, with 98% of them repaying their loans on time.
According to data from the People’s Bank of China (PBOC), SMEs account for over 90% of business entities in China and contribute to 80% of urban employment and 60% of Chinese GDP. As of June 2020, MYbank and its partners have served 29 million SMEs in China, including street vendors. Their average loan size is RMB 36,000 (approximately USD$5,000) and 80% of them had previously never received business loans from a bank.
Leveraging Ant Group’s blockchain technology, Log56.com, a Chinese logistics platform with 70,000 registered corporate users, has helped 200,000 truck drivers and micro logistics business owners successfully apply for loans from MYbank and its financial institutional partners. Ant’s blockchain technology helped to ensure key logistics information, such as order and execution numbers, are tamper-proof. This also reduced costs related to risk management and helped MYbank’s AI to calculate an accurate line of credit for SME operators on the platform.
Jinmailang Food, a Chinese food manufacturing company, has over 5,000 distributors across its supply chain. Many of these distributors had to suspend their operations during the COVID-19 pandemic. To help these distributors cope with the economic impact of the pandemic, Jinmailang introduced MYbank and its “310 model” to help them prepare for recovery in the post-COVID-19 era. Using key operational data provided by Jinmailang, such as order fulfillment and logistics records, MYbank was able to extend lines of credit to SME distributors so that they can use the short-term funding to restock from the food producer. This also served to ensure the funding will be used solely for economic recovery purposes.
MYbank has implemented a series of measures to help small and micro business owners overcome the economic impact of the COVID-19 pandemic, including waiving or lowering interest rates. In March, MYbank partnered with 100 banks to launch the “Contactless Loans” initiative to support SMEs as they resume operations and overcome the impact of COVID-19. According to the China Banking Association, the initiative had served over 10 million SMEs and extended loans totaling RMB 400 billion as of the end of April 2020.