If you are familiar with LendingClub in America, you will get what Pandai.cn is trying to do. Online consumer finance or Peer to Peer (P2P) in China is a very new concept in China, where cash still dominates most transactions. However this isn’t the first time, an online lending platform was attempted in China. Calvin Chin, attempted to test the model with student loan market with Qifang.cn
Founder and CEO, Roger Ying is a Stanford Graduate and grew up in South Africa. He came to China to help China develop faster and he’s picked a very challenging market with his team of 6 in Beijing.
Ying claims that social lending is a 7 Trillion + RMB/year market in China. Pandai.cn delivers next generation online financial services by providing credit loans for borrowers and high fixed income products for lenders on safe, transparent and easy-to-use online platform. Moreover Pandai.cn will be the only company in China that will allow its customers to build credit and price loans that are tailored to its customers.
The innovative feature of Pandai is their credit risk system based on working models in China, India and the USA.Price loans in according to target market segment – not a one-size fits all product.
Of course China’s biggest competitors for loans are banks and guarantee companies. However Pandai argues that banks have very stringent policies and only loan to people with money and Guarantee companies charge exorbitant interest rates. And other p2p lending have no credit risk expertise thus not protecting their lenders and borrowers suffer a poor service.
The business model is fairly straight forward too. For connecting borrowers with lenders and upon loan completion, a service fee is charged. Late repayment fees and early repayment fees will also generate revenue.
Looking at the site, there are an infinite reasons to use it. It could be borrowing money for a new laptop, to go to college, to buy a car or a house. Pandai.cn has already tested the model on a few seed users.