Sun Hung Kai invests in China P2P lending site Dianrong
Sun Hung Kai & Co.(SHK), a leading Hong Kong financial institution, has invested in a Series B round of funding for Chinese peer-to-peer (P2P) lending service Dianrong.
The specific investment amount was not disclosed but it was said to be tens of million dollars. Dianrong was launched in March 2013 by Soul Htite, a former Oracle executive who co-founded US-based P2P lending service Lending Club, and Yuhang Guo, an intellectual property lawyer. Htite remains a technology advisor to Lending Club and sits on its advisory board.
The platform connects individual lenders with small-scale borrowers, essentially meeting the needs of small and medium-sized enterprises that don't qualify for bank financing. It previously secured angel funding from Linear Ventures, formerly ZJ Capital, and a Series A round led by Northern Light Venture Capital early this year.
As of November 2013, Dianrong's trading volume was in excess of RMB100 million ($16.5 million) with more than 10,000 registered users. The average annual rate of return for lenders is 14-17%, while Dianrong guarantees participants will have 100% of the principal returned to them.
"The combination of SHK's 45 years of experience in risk management and operations and technology and cost efficiencies offered by Dianrong.com represents a highly promising model for emerging markets. I am confident that following what we have accomplished in Mainland China, the model can be easily portable to Hong Kong and the rest of Asia," Htite said in a statement.
SHK operates across wealth management, securities brokerage and consumer finance in over 180 locations across Hong Kong, Macau and mainland China. In June, United Asia Financial, the group's consumer lending subsidiary, signed a strategic partnership with 58.com, a Chinese online classified site, with a view to building a P2P lending platform for local merchants.
58.com, backed by Warburg Pincus, SAIF Partners and DCM, raised $187 million in an US IPO last year. Strategic investor Tencent Holdings invested $736 million in the firm in June.
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