The ant submitted the prospectus: the net profit was less than one tenth of that of the bank, but it was inclusive finance.

If ants are regarded as financial institutions, its revenue and profits can hardly support the valuation of $200 billion. However, it should not be ignored that the business layout of ants does not pursue the maximization of benefits under the traditional financial system. According to some data in the prospectus, what the ants are trying to do is to open up a new track in inclusive finance through science and technology. It is difficult for this kind of track to provide high profits in a short time, but it solves the objective financial service demand of the society and has a huge market prospect.

Inclusive finance's confusion.

In 2005, the United Nations put forward the concept of "inclusive finance" for the first time: "Based on the requirement of equal opportunities and the principle of sustainable business, we will provide appropriate and effective financial services to all social strata and groups in need of financial services at an affordable cost."

A year later, the Bangladeshi economist Yunusin Grameen Bank won the Nobel Peace Prize for his successful practice in inclusive finance.

1974, Grameen found in a rural survey that the local peasant women who woven bamboo baskets fell into a "low income trap": because there was no surplus, they borrowed usury to buy knitting materials every day, and the income from selling bamboo baskets could only meet their daily food and clothing. Therefore, they are always supported by lenders.

Yunus provided a loan of $27 to 42 peasant women. Because she can buy her own materials, the peasant woman has a little balance every day. With more and more savings, they quickly paid off the loan. This made him realize the significance of inclusive finance-the reason why the "poor" are poor is sometimes just the lack of an opportunity to jump out of the trap.

However, for the "silent majority" such as small and micro enterprises, farmers and urban low-income people, how to obtain financial services was almost an unsolvable problem in China and the world at that time.

The obstacle appears in inclusive finance's definition: "affordable cost". At that time, traditional financial institutions could not solve the cost problem at all.

Inclusive finance's audience often only needs a relatively small amount of credit funds. For banks, loans below 6,543,800 yuan are almost unprofitable-small and micro enterprises and grassroots individuals are relatively weak in economic ability and lack sufficient credit records, so it is difficult for banks to judge their credit level and repayment ability. Moreover, the audit and risk control of banks are mainly manual and costly. It is also a set of investigation and audit. Lending 654.38+00,000 is definitely more profitable than lending 654.38+00,000.

So a paradox is that small and micro enterprises in China get the first loan in the fourth year of operation on average, while their average life cycle is only three years.

From the bank's point of view, it is a natural decision to serve 20% of the population and earn 80% of the money. Even if it is a small business loan of1100,000 yuan-1100,000 yuan, due to the high non-performing rate, the bank is not doing very well. According to the interim data of 20 19, the NPL ratio of small enterprises in China banking 1 10,000 yuan-1 10,000 yuan reached 5.9%, much higher than the overall NPL ratio of 2% in the overall loan business.

/kloc-below 0/10,000 is Pratt & Whitney.

When Ali Small Loan was established in 2009, the reason was that it was difficult for small and medium-sized businesses in Taobao to obtain loans. Small and medium-sized businesses in Taobao were new occupations at that time-the loan amount needed was not necessarily high, but the demand was frequent, and they could pay back the money soon after purchasing and turnover; The information they can provide in traditional financial institutions is limited, and "selling things online" is even difficult to be recognized as a formal occupation.

At that time, the financing difficulties of millions of small enterprises had been highlighted, and the subprime mortgage crisis that broke out at that time made this situation worse. Ali must provide protection for these small businesses that make up his body. In this sense, the motivation to be inclusive finance is imprinted in Ali's genes.

Ma Yun drew a red line for Hu Xiaoming, the CEO of Ali Small Loan at that time-he only made small and micro loans of less than 6,543.8+0,000 yuan. This decision is not without controversy. After all, the loan profit below 654.38+0 million yuan is too thin. In order to maintain the healthy survival of Ali's small loans, is it necessary to access some large loans?

The final decision is that the red line of 654.38+0 million yuan cannot be moved. Because loans above 1 10,000 are really easy to earn, without this red line, KPI will soon pull Ali Small Loan back to the old road of traditional financial institutions. Contrary to the traditional "28 Law", Ma Yun's goal for Ali Small Loan is "82": to serve 80% of the group and earn 20% of the money.

Since we have chosen this road, we must control the cost of a single loan. The model proposed by Ali Small Loan is "3 1 0"-3-minute application,1minute loan, and 0 manual intervention. To realize this model, it depends on automatic risk control and loan review system and perfect technical platform. The transaction and operation data of millions of small businesses in Taobao on the platform has become the starting point of risk control.

In addition to observing the data of small businesses themselves, we should also compare them with the data records of similar stores to judge the financing needs-for example, giving a higher amount in the peak season, which is convenient for stores to expand their purchases.

Through this model, Ali Small Loan can make accurate judgments that traditional banks can't. For example, a merchant has achieved much higher sales than the daily sales during the "Double Eleven" period. If only this data is used to provide credit for merchants, problems are likely to arise; By comparing the historical performance of businesses with that of similar businesses, we can objectively evaluate the extraordinary performance of "Double Eleven".

At present, among the customers of online merchant banks, the non-performing rate of small and micro loans is only about 2%, which is far lower than the non-performing rate of small and micro loans of 5.9% in traditional financial institutions. In terms of cost, there is also a huge difference between the two. Hu Xiaoming once revealed that the operation and maintenance cost of a single loan under the "3 10" model is only 2 yuan, while the cost of traditional financial institutions is 2,000 yuan.

Treat people as good people first.

This is why until 20 10, 74% of households in China have never applied for a credit card. It is difficult for China people to obtain formal, safe and relatively low interest rate consumer credit services.

Ants, on the other hand, tend to regard everyone as a "good person" who can get financial services. As long as they can't prove that they have a problem, they should be served. "Even if 100 people have problems, we should not give up the remaining 90 people." Hu Xiaoming said so.

Bai Hua is an example. In 20 15, when Hua Bai was just born, it was regarded as the solution to the "Double Eleven" payment problem: when the bank's system could not carry huge short-term transactions, Hua Bai first helped the buyer to pad the money to complete the transaction, and then slowly settled with the bank.

This involves a question: how much does it cost to "pad" flowers for users? What is the quota for each customer? The flower buds take the form of "small steps and quick running". Bai Hua is also willing to give a small amount of credit to customers who have hardly kept any information. And every use, every credit accumulation, has become the basis for the subsequent increase in the quota.

According to the prospectus, Huayuan and Lending have served 500 million users in the past year. Previously, ants had announced that 70% of Huayuan users did not have credit cards. This means that flowers and loans have really reached the grassroots groups that traditional financial institutions have never served.

Imagination in Pratt & Whitney field

After ten years, ants have gradually "crawled" out a preliminary map of inclusive finance. From the prospectus, we can get a glimpse:

730 million users are using ant's digital financial services. In the past year, a total of 500 million people used and borrowed flowers. The online merchant bank served 20 million small and micro enterprises last year. Ant Group is already the world's largest online consumer credit and credit service platform for small and micro operators, with a credit balance of 2. 1 trillion yuan. Among them, 98% of the credit balance comes from banks or licensed financial institutions that cooperate with ants.

In terms of volume, China has the largest population and the second largest economy, while inclusive finance has the largest population. The government also encourages and supports attempts to solve the financing difficulties and expensive financing of small and micro enterprises. In August this year, Guo Shuqing, Chairman of the China Banking Regulatory Commission, revealed that at present, 23.6 million small and micro enterprises in China have obtained bank loans. It is obviously impossible to achieve this figure by relying on the traditional financial model, and the integration of technology and finance is the general trend. The technical and empirical advantages of ants in financial services for small and micro enterprises can also be used for reference by traditional financial institutions-in June 2065438+09, Hu Xiaoming announced that 50 financial institutions would copy the "3 10" model of online merchant banks; In March this year, more than 100 financial institutions joined forces with online merchant banks to realize contactless loans through the "3 10" model.

Inclusive finance's business profit margin is low, and the profit of Ant Group is indeed far less than that of banks. However, to measure the value of a company, is it only the standard of making money? Robert shiller, winner of the Nobel Prize in Economics, said in Finance and a Good Society that finance exists not to make money, but to help achieve social goals. The prosperity and huge profits of modern financial industry almost make people forget why financial services started in the first place.

If a company can solve the social needs, especially the production and survival difficulties of vulnerable groups, why does it make a lot of money?