LexinFintech sees installment payments boosting China's domestic consumption

Installment payments are helping to power China's domestic consumption and sales of online lender LexinFintech Holdings Ltd's installment finance platform Fenqile surged 220 percent during an e-commerce shopping festival.

Fenqile, translated as “Instalment Pleasure” in Chinese, lets consumers buy electronic equipment like mobile phones and consumer accessories such as handbags on credit and repay the loan in installments.

Sales of Shenzhen-based LexinFintech's Fenqile surged 220 percent during the annual 618 e-commerce shopping festival on Monday, a major mid-year shopping event initiated by e-commerce giant JD.com.

The average order amount per user on the platform during this year’s festival rose 37 percent annually from 5,024 yuan to 6,895 yuan. The number of Fenqile users who participated in this year’s 618 festival doubled from last year, LexinFintech said.

Fenqile offered promotions and interest-free installment plans during the 618 e-commerce event, with digital products accounting for four fifths of the total sales. The iPhone X, in particular, took up a third of total smartphone purchases on Monday, according to LexinFintech.

The online lender intends to further tap the growing trend among young Chinese consumers to buy now and pay later, as the number of consumers using installment payments for e-commerce purchases in China is set to soar to 170 million this year, from 95 million last year, according to the “2017 China Installment of E-Commerce Market Research Report” released in March by iiMedia Research.