Case Study: China Risk Finance
Description:
China Risk Finance LLC (“CRF”) is the leading consumer credit management solutions provider in China, offering its services through two business divisions: CRF Marketing Services (“CRF MS”) and CRF Decision Solutions (“CRF DS”). CRF MS provides advanced information-based marketing solutions to facilitate growth in financial institutions’ client base, whereas CRF DS develops credit analytics and scoring technology. CRF operates credit card marketing offices in 23 major Chinese cities and is the only company in the world with a double-byte enabled Chinese language system for consumer credit underwriting.
Venture:
DLB became the lead investor in China Risk Finance in 2007, allowing the company to utilize the growth capital to fund a national expansion of CRF MS and the enhancement of its credit solutions technology within CRF DS.
Investment Thesis:
China represents the largest emerging market for credit products both from a retail (CRF MS) and commercial (CRF DS) perspective. CRF’s business model captures the cultural shift in China from a cash-based society to a credit-based society. China’s hosting of the 2008 Summer Olympics will only serve to accelerate this trend.
Growth in Outstanding Balances on Credit Cards in China
DLB Role:
DLB adds incremental value beyond capital to CRF through our extensive experience within the credit card business and in China. Additionally, Doug Brown’s extensive Chinese financial services contacts developed through his tenure as Vice Chairman of Morgan Stanley will aid CRF in business development and distribution enhancement.
Current Status:
CRF is looking to use their existing relationships and sales team to expand into the peer-to-peer lending sector, acting as an agent to match lenders to low-income borrowers with little access to bank lending.
To learn more about CRF, please visit www.crfchina.com/eng/Home/home.html