Chinese Ridesharer DiDi Plans to Launch Private Bank in Tianjin

Ridesharing giant DiDi Chuxing has ambitions to expand its presence in the Chinese financial and fintech sectors with the launch of its own private bank in northern China.

After obtaining licenses for online microloans, insurance, payments and financial leasing from regulators, Didi now hopes to obtain a banking license for the establishment of a private bank in the northern Chinese city of Tianjin, according to a report from Xinliu Caijing.

Dong’an Bank (东岸银行) will have registered capital of 3 billion yuan and its registered address will be in the Tianjin Eco-city.

Its two key shareholders will be DiDi’s fully invested subsidiary Dirun Keji Co., Ltd. (迪润科技有限公司), which will hold a 30% equity stake, and Tianjin Datong Group (天津大通集团), which will hold a 21% stake.

The remaining equity will be divided amongst six other founders shareholders.

First launched in 2012 in Beijing, DiDi has emerged as China’s leading ridesharing service following a merger with Kuaidi Dache in 2015 and the acquisition of Uber China in 2016.

DiDi currently has over 450 million ride clients and around 50 million registered drivers, with over 20 million individual orders processed each day.

DiDi posted losses of 10.9 billion yuan in 2018, however, according to internal data leaked at the start of 2019.

CEO Cheng Wei has indicated that the company has not achieved profitability since its founding in 2012, and that in 2018 its losses had reached 39 billion yuan as the company continued to chase market share.

In mid-July the Wall Street Journal reported that DiDi was seeking USD$2 billion in financing, while on 25 July the company announced Toyota would be making an investment in DiDi of $600 million, some of which would be used for the establishment of a joint-venture company with GAC Toyota.

DiDi first made a foray into financial services in 2015 when it teamed up with a Ping An Group subsidiary in Shanghai to launch an accidental risk insurance product for drivers and passengers.

In June 2016 DiDi teamed up with China Life Insurance to launch insurance products after the latter made a $600 million investment in the ride-sharer, while in December 2016 DiDi obtained an insurance agency license via the acquisition of controlling stake in a Beijing-based company.

Reports emerged towards the end of July 2019 that DiDi planned to invest in Hyundai Insurance (China) (现代财险) via Dirun Keji.

DiDi has also expanded into the consumer finance sphere with the launch of an automobile consumer finance product via its app in 2016, the launch of a licensed microloan company in Chongqing in August 2017, and the release of an independent financial app, DiDi Finance (滴滴金融), in July 2018.

In March 2017 DiDi launched the “Jinjibao” (金桔宝) wealth management product for users.

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