Decrypt P2P chaos behind the pain points and opportunities

DoNews July 7 (Reporter Zhou Qin Yan) When it comes to corporate borrowing, in the past, there were usually two methods, bank loans and non-government loans. However, the high threshold of bank loans, tedious procedures, time-consuming, many in urgent need of loans to businesses in the door. The low threshold of private lending, but high interest rates, can only be used for short-term cash flow, and can not be used as long-term financing sources.

With the development of the Internet industry, small and medium-sized enterprises with financing difficulties now have the option of lending P2P networks. Information technology represented by the Internet has drastically reduced the information asymmetry and transaction costs and has made up for the deficiencies of the formal financial institutions so that both investors and borrowers can benefit. Borrowers have access to credit facilities that are more convenient than private borrowing, lower borrowing costs and investors receive higher returns than bank deposits.

Building blocks box is a representative of the P2P platform, the rapid development. Since its launch in August 2013, the platform has aggregated over 1.3 billion transactions and served more than 350 enterprises with an average funding of 3 million. In an exclusive interview with DoNews, its founder and CEO Dong Jun said that at present there are many financing needs for SMEs in China, but the banks are not well served and the cost of private lending is too high. This also leaves a lot of room for P2P platforms Big space

Dong Jun said that the reason for the rapid development of building blocks lies in the preparation of the data information of the previous year. For P2P platform, risk control is the core. It is impossible to have no risk at all. What the platform needs to do is to minimize the risks and at the same time take both financial and Internet ends into consideration. It is necessary to understand both the financial and the Internet.

In his opinion, judging the pros and cons of peer-to-peer (P2P) platforms is based on the two attributes of finance and the Internet. Financial end security, the rationality and liquidity of returns, and the product experience on the Internet are all important considerations.

Dong Jun believes that half of the current Internet finance industry is the sea, half is the sun. On the one hand facing the larger market demand, on the other hand, there are a lot of negative news. For P2P industry, is still in the early stage of the industry, the most important point of competition is how to better serve our customers.

In addition, he believes that the ultimate core of Internet finance strategy will be reflected in the data, for the hurried P2P industry, entering the data phase will be a decider, a year later will be such a tiebreaker.

The following is Dong Chun readme finishing:

It started quickly because it was well prepared

Before I did P2P, I had two major working experiences. One was a trader who spent six years in the United States. Later, he returned to China to do financial services to small and medium-sized enterprises for a period of time, including financial consultation, financing, and small loans. Half of the more theoretical experience, such as the secondary market based on data decision-making, half of the field experience, according to the specific needs of enterprises or individuals to do risk judgments, risk management.

At present, there are many financing needs for SMEs in China, but they are not well served by banks and the cost of private lending is too high. This leaves a great opportunity and space for the P2P platform. Before making the box, the founding team cut into a data company in early 2012 to find out how to make micro-loans more effective. That system has done more than 500 customers, start with some foundation, there are now more than a thousand companies in the database. We are still a prepared startup company.

The billions of transactions for the financial services, only a very small number. P2P industry is a trillion-level market, the entire industry is still in its infancy, a long way to go. The building blocks can start relatively quickly in a relatively short period of time and have a bearing on the team's combined background. Now that we have a deeper understanding of the "building blocks" portfolio, there may be a combination of models for combinations of mobile products and risks in the future to serve our customers with better risk control. So we think the combination is very important, which ensures that we can get started quickly.

Wind control logic and steps

Wind control is a very important P2P platform, the focus must first solve the problem of wind control.

First of all, the mode we are landing now is the information platform, and the information platform itself can not participate in the transaction. Our philosophy is not to subvert the financial industry and reduce risk. Rather, it's better to disclose the risk and let the customer do the right thing. Today's market is not yet ripe, most of our clients are still at a low risk or expect to take risks, but we must do this direction. Jigsaw box positioning sincere and transparent Internet finance, not to reduce the overall risk, but to find a direction to configure and allocate risk.

On this basis, we have designed a set of systems to circumvent several common financial risks. The first is the risk of the project. By doing data system in about a year, the data of more real borrowing customers are excavated for analysis, so as to minimize the credit risk and the default risk of the enterprise.

Secondly, we did some remedial measures. For example, some of the projects would take the mortgage and some would provide the guarantee as a remedy to endorse some customers who already have some credit quality.

In addition, we have also added some mutual insurance funds, also known as risk protection schemes. Equivalent to all borrowers on the platform to participate in a common insurance plan. Clients come up with a smaller portion of the fund to cushion the platform against extreme risks and reduce risk for investors. Ultimately not to say completely risk-free, risk-free is a lie. The most important thing is to put the system in the end what kind of combination of risk to tell investors, so that different investors to choose their own risk, while matching the corresponding benefits.

How to collect business information, access to the project?

In collecting corporate information, the building blocks are based on the tradition of improving traditions and making innovations on the traditional basis. First of all risk models and data control is based on matching, for many years the plate in the end what business or the borrower is the most important, we first seize these, reducing the risk in this area.

The collection of these people's information is based on the traditional financial processes. The box is to make some optimization of this process. A lot of business information, such as some business license, the previous need to go to the Trade and Industry Bureau, and now you can get on the Internet. Corporate bank statements previously required to go to the bank to print, and now can get through online banking. We made some optimizations where we could optimize. Optimized, we go to optimize the process, not the way to optimize it.

The current platform for the current business there are two main sources, the vast majority come from their own channels to develop, followed by cooperation guarantee company recommended.

In acquiring projects, the risk-based priority is higher than the growth priority, and the reasonable portfolio priority is higher than the priority of the larger investment matching. Therefore, we should be more cautious in opening up the borrower. We should mainly cut into healthier industries and groups, and develop products and designs the entire risk framework and models in these industries and groups. We should be at an unsteady pace. Some of them Things really need time to accumulate, with a star product, to be relatively cautious to accumulate data, and then a certain basis, it should run faster.

How to judge the pros and cons of P2P platform?

Now on the market a lot of judgments P2P platform is good or bad Raiders, but arena is more chaos, it is hard to say who the highest martial arts. Financial affairs must be pulled out of time before they can see it. For P2P platform itself, we must first have the financial product design and operation capabilities. This is where the core risks are controlled. Second, to understand Internet users, you need to have the product, the market's ability. Again, the technical ability to make the whole system smoother and safer is important.

Judging the pros and cons of P2P platform should be based on the two attributes of finance and Internet. The security of the financial side, the rationality and liquidity of return, and the product experience on the Internet are all important considerations.

There are three factors that are more important than just finance. Safety, reasonable returns and liquidity. For example, whether a financial product in the end is safe, the proceeds are reasonable, the interest borne by the borrower is a reasonable cost structure, if not reasonable, the borrower itself can not support it. Once again, the liquidity, the platform cast into it, whether it has its own cash capabilities, many platforms provide the conversion function.

From the Internet end, the product is comfortable to use, is not every day to see the proceeds, is not a good management of the money, there is not enough capacity, resources continue to understand the situation of this platform, whether to establish a very good Community groups, whether through third-party channels to understand the platform information, these are through the thin Internet to increase the experience and trust of things.

In different periods and different modes, the rankings of these factors are also different, and the safety of the current stage ranks first. The most important thing is done by people, or will fall to the team, all of the performance is the embodiment of the ability of the team. Building blocks have a very complementary team, a strong team, their ability is reflected in the website experience, product design, sincere and transparent positioning, daily disclosure of information and other aspects.

P2P industry is still staking

Internet finance, P2P, half sea water, half sun. At the same time facing a larger market demand. The other side has a lot of negative news. The entire industry is still at an early stage, the scale should not exceed 1,000 billion. Relative to the opportunities available on the market, the situation now looks as if some people in the desert are running in all directions and will not necessarily meet for some time. Everyone needs to adjust their own pace. Now the more important point of competition is how to serve customers.

The industry is basically showing a more aggregated state. Although there are nearly 1,000 platforms, most of the businesses are still aggregated on a handful of platforms that eventually will come out. Due to different modes and different methods of risk control, Different, there may be some changes.

Now run faster in the industry, the model is relatively clean and clean platform, are still located on the Internet side, have not made money, are in the investment, how to expand the platform is the highest priority. We are all negative profits in the growth, and the offline platform may be higher profit margins. Now basically still in the staking stage.

Compared with traditional finance, we are now in a period of crazy growth. There are a lot of platforms appearing. However, all aspects are still immature and the mortality rate is higher than that of traditional financial institutions. However, Internet finance will achieve explosive growth, finding a number of sustainable and rapidly expandable models much faster than traditional financial institutions.

The core strategy of Internet finance is data

The ultimate core online financial strategy will be reflected in the data, in fact, if the BAT aside, no one is the data king, did not produce a healthy ecosystem of data, more or in the thin user experience phase, to enter The data phase is a tiebreaker, a year later will appear in such a tiebreaker.

The soundness of China's credit system is relatively backward, which is also a painful opportunity. China is a time when many entrepreneurial teams are working hard. I believe there will be good teams and companies coming out, and the building blocks may be one of them.

More interesting logic, pre-electricity business through the information flow and logistics to open up the flow of funds, financial flow of funds may also be through such a market to break through the flow of information and logistics, which is a piece of logic, which one can see Find the right model as soon as possible.

Do a good job of each stage of the model

The choice of P2P model requires some capacity and resources, because the transaction is relatively close, so the risk is greater and the responsibility is greater. At this stage, we mainly exert force in both the regiment and the market. To accumulate traffic quickly, we need enough customers and enough good services to support it.

Of course, we have to consider the future direction of development, but need to do a good job of each stage of the model. This phase of the model is how to control the risk of a sufficient number of projects received on the platform, risk control, service ends. This thing itself needs a lot of investment, this advantage will eventually be revealed, we have access to valuable customers at both ends. The financial services they can enjoy are more than just loans and loans.

Our current project sources, there are two main, the vast majority come from their own channels to develop, followed by cooperation guarantee company recommended. Guarantee companies are complementary to our model, the vast majority of business comes from their own channels. For the next step how to find a good financing company, our logic is very simple, there are many SMEs in China, but SMEs are through the upstream and downstream or larger business transactions, we get to the big company cooperation, Find financing needs of SMEs in the supply chain. (Finish)