Chinese Fintech Firm 9F Files For US IPO, Seeks To Raise $150m

Beijing-based online consumer lender 9F has filed to raise $150 million in an initial public offering (IPO) in the US, partly to finance its expansion in Hong Kong and Southeast Asia, according to its filing with the SEC.

The filing is heavily redacted and 9F, also known in China as Jiufu, has not specified the number and price of American depositary shares it intends to sell. Its prospectus showed that the fintech firm plans to list on the New York Stock Exchange or the Nasdaq under the symbol JFG.

The company, which was set up in Beijing in 2006 by founder and chief executive Sun Lei, who was among China’s first internet finance entrepreneurs, has more than 76.7 million users, with more than 8 million in the Greater Bay Area.

In September, 9F teamed up with international firms to apply for a virtual banking licence in Hong Kong, with plans to use the city as a platform for the group’s overseas expansion.

The company’s core products include loan, online wealth management, and payment facilitation, all integrated under a single digital financial account. It uses big data and its own credit scores model to make it simple and easy for customers to apply for loans online.

The fintech firm owns several brands like 9F Puhui, 9F One Card, and Wukonglicai.

According to its prospectus, 9F’s registered users increased from 27.6 million in 2016 to 76.7 million as of the first three months of this year. Its loan origination volume, however, declined from 13.9 billion yuan in 2016 to 9.7 billion yuan for the three months ended March 31, 2019.7.28, according to its filing.

Considered by research firm Oliver Wyman as the largest online consumer finance platform in China in terms of outstanding loan balance as of last year, the company booked a total net revenue of $179.4 million in the first three months of this year, an increase from the nearly $159 million during the same period last year.

9F said it plans to use the proceeds from the IPO toward broadening its product offerings, including loan and wealth management, and to expand investment in Hong Kong and Southeast Asia. It also plans to fund further investment in research and development, particularly on artificial intelligence and big data technologies.

“We have established operations in Hong Kong and Indonesia and plan to expand investment in Southeast Asia and establish deeper cooperation with local financial institutions where we see meaningful opportunities relating to the export of our advanced and robust technology capabilities,” 9F said.

So far this year, 9F has established cooperation with the Thailand branch of Commerce International Merchant Bank, a major bank in Southeast Asia with headquarter in Kuala Lumpur, and obtained a few key financial service licenses in Hong Kong.

In addition, the company said it has set up its overseas research and development center in Silicon Valley to develop its artificial intelligence and emerging blockchain technologies.