China Rapid Finance

China Rapid Finance (NYSE:XRF) operates one of China’s largest consumer lending marketplaces in terms of total number of loans, having facilitated approximately 20 million loans to over 2 million borrowers at significantly lower borrowing costs than many of its competitors. According to the People’s Bank of China, as of the end of 2015, there were approximately 500 million individuals with quality employment records but no credit history. The company refers to these individuals, who regularly use mobile devices, as EMMAs (Emerging Middle-class, Mobile Active consumers). China Rapid Finance believes EMMAs constitute one of the largest untapped consumer credit market opportunities in the world. The company acquires quality borrowers through multiple channels, and has been able to establish a leadership position in China’s consumer lending industry because the company is able to use its proprietary technology to efficiently identify and select prime and near-prime EMMAs for its platform. Through its “low and grow” strategy, the company initially offers smaller, shorter-term loans to these EMMAs and then uses its proprietary decisioning technology to proactively offer them larger, longer-term loans as they demonstrate positive credit behavior, allowing the company to retain high quality EMMAs with significant lifetime consumer value.