Ebaodai is a financial information service plat form subordinate to Guangdong Ebaodai Asset Management Co, Ltd, which formally launched in June 25, 2014. It first created a new internet financial investment model: “investors-Ebaodai-cooperative institution-borrowers” both online and offline with the combination of platforms and institutions.
By Jianfei Leng and Qiaoyun Ye
Business College of Hohai University, Nanjing, China
Image Attribute: Ebaodai.com Website Screenshot
Ebaodai
is a financial information service plat form subordinate to Guangdong Ebaodai
Asset Management Co, Ltd, which formally launched in June 25, 2014. It first
created a new internet financial investment model:
“investors-Ebaodai-cooperative institution-borrowers” both online and offline
with the combination of platforms and institutions. It is one of the Peer-2-Peer (P2P) platforms that first truly realized third party funds custodian as well as
introduce third party guarantees, third party asset valuation and third party
law office as cooperative institution. It is also the first landed Guangzhou
equity trading center, the first settled in Guangzhou Internet Financial
Industry Park. Its total amount of transactions exceeded one hundred million in
only half a year in 2014. On April Fool’ sday in 2015, the total amount of the
transaction exceeded 2 hundred million with no overdue or bad loan.
1). The key is
business model innovation
Ebaodai
cooperated with the third parties both online and offline instead of using the
traditional mode. Cooperated institutions carry out the examination and
verification of qualification of borrower offline, and Ebaodai internet
financial information service platform pick out investors online. It chooses
the perfect qualified and reliable loan companies, asset evaluation companies,
guarantee agencies and law firms as partners. It initially verifies borrowers
through the mechanism of risk control and reexamines by asset evaluation
companies and guarantee agencies, the law office conducts the second audit over
loan qualification and the validity of the pledge. Only the high quality
project would release on the Ebaodai platform. This model has its advantages
over other P2P platform, the risk is blocked outside the cooperation companies
through assessment and audit layer by layer. Although it will reduce some
business, it protects the security of the platform investors.
2). 10 major
security systems
a). Strict
access system: Ebaodai sets up a strict access system to examine the financial
strength, credit status, operating conditions, risk control ability and
debt-paying ability of cooperated companies, only the approved and qualified
companies have the opportunity cooperating with the platform to provide users
with services.
b). Multi
security examination over project: It includes on-the-spot investigation,
examination of information, asset assessment, debt-paying ability assessment,
mortgage management and the second examination.
c). Real third
party’s funds custody: Ebaodai first adopts third party’s funds custody, which
realizes the separation of the funds between the platform, debtor and creditor
and cooperative companies. It provides investors with secure funds management.
d). Joint
liability guarantee of the institution: Ebaodai directly requested for
compensation and debt repurchase instead of traditional form of security. All
the loan programs are recommended by cooperated companies which also offered
joint liability guarantee. It also requested to provide 100% guarantee of
principal and interest for each loan projects. Once the loan project appeared
overdue risks, Ebaodai would ask the company to pay 100% advanced principal and
interest to protect the safety of investors’ principal and interest.
e). Loan loss
provision: It consists of two parts: initial insurance and project insurance.
Initial insurance (10 million) was invested by Ebaodai at the very first time
to deal with possible overdue risk; project insurance came from each loan
projectof a certain proportion. Thus the continual accumulated loan loss
provision can guarantee the safety of principal and interest of investors.
f). Third
party’s asset value assessment: Ebaodai took the lead in introducing the third
party asset appraisal institution. It offered professional and objective value
assessment by field visiting of underlying projects’ guarantee and pledge,
which can determine a reasonable amount of loan money to ensure the legal
rights and interests of debit and credit sides.
g). Consultant
guidance of professional service: Ebaodai provides customers with financial
guidance, project funds flow tracking, repayment remind and investment advice
by their professional consultant team. VIP memberseven can enjoy a one-to-one
investment guidance.
h). A
whole-process escort offered by leading financial experts: Ebaodai established
the best advisory team to provide consultant guidance for its development by
inviting the leading financial experts nationwide. The experts team brought
continual wisdom for Ebaodai from policy judgments, market analysis, user
requirements, product design and service upgrades in a all-round way. For
users, it provides professional, safe, and leading business security.
i). Lawyers to
provide legal protection: Ebaodai cooperates with authoritative law office to
offer the platform with full legal advice and consultants. It ensures that the
platform and the parties operate in line with national policies and regulations
and protect the interests of all parties.
j). Technical
security of the platform: Ebaodai is relying on Ali’s strong cloud hardware and
network. With the use of double server interactive data management on cloud and
offline and the adoption of security design of the system architecture, it identified
as SSL global trusted site.
3). Strict
audit process of risk control
The financial
projects released on Ebaodai platform are high quality projects recommended by
the cooperative organizations. After the loan application launched by the
borrowers, cooperative agencies, Ebaodai risk control team and Ebaodai audit
committee would carry out the examination. Afterwards, adopted projects can
invite bids on Ebaodai platform. All these can guarantee the investment
security of investors.
4). Cooperate
with banks
Ebaodai
reached strategic cooperation with Guangdong conghualiuyin village bank
partnership company (which subordinate to Huizhou Bank) on October 2014. They
carry out internet financial information service of bank financial products
together. Ebaodai became the first platform to cooperate deeply with bank.
The
cooperation, on the one hand, is expanding the bank’s business channels,
helping to develop new products and services and improving the efficiency of
bank loan projects; on the other hand, with strong financial strength of the
bank, Ebaodai projects obtain more insurance, which can improve the confidence
and investment enthusiasm of investors.
Conclusion:
China’s
P2P net loan industry is developing rapidly; new platforms emerge in large
numbers. For lack of legal supervision since it has been born in our country,
its development is not standard; hidden risk becomes exposed. Many platforms
close down for all kinds of reasons, which bring a serious blow to the
credibility of the industry. The healthy development of the new P2P platform
has important practical significance to the stability of the financial order in
our country.
About The Authors:
Jianfei
Leng - Business
College of Hohai University, Nanjing, China and Management College of Fudan
University, Shanghai, China
Qiaoyun Ye - Business
College of Hohai University, Nanjing, China
Publication Details:
This
article is an excerpt from a techincal paper, titleld “How Can New Online P2P
Lending Platform Catch up from Behind―Take Ebaodai as an Example” published at iBusinessVol.07
No.04(2015), Article ID:61654,5 pages
Download The Paper - LINK
Cite This Article:
Jianfei Leng,Qiaoyun Ye,
(2015) How Can New Online P2P Lending Platform Catch up from Behind—Take
Ebaodai as an Example. iBusiness,07,132-136. doi: 10.4236/ib.2015.74015