Chinese peer-to-peer lending giant Dianrong has officially joined forces with Hanwha Group, with plans to launch a range of fintech services across South Korea and South East Asia.
The equal join venture was agreed to in Seoul on Thursday. The deal ushers into life a new company – as yet unnamed – that will launch a marketplace lending service in South Korea and Asia. The platform will be headquartered in Singapore, with offices due to open within the month. We learn from The Korea Herald that the joint ventue will look to establish an affiliate in Korea in March in order to begin operating a peer-to-peer lending service as early as August or September.
News first broke of the partnership back in late November, when a Memorandum of Understanding was signed by both businesses. The deal has been under discussion since April 2015.
The Hanwha Group is Korea’s 9th largest conglomerate. The company generated over $42.6 billion in sales in 2014, and boasts 56 subsidiaries and 190 affiliates worldwide. Dianrong is one of China’s leading peer-to-peer lending platforms, and is backed by Standard Chartered and the China Fintech Fund. The platform secured $207m in a fundraising round back in August 2015, and is reportedly looking to raise as much as $500m in an upcoming investment round. Founder Soul Htite is also a Co-Founder of Lending Club – the US' largest marketplace lending platform.
The joint venture will launch into a part of the world where peer-to-peer lending activity has been relatively sparse. We recently covered the launch of peer-to-peer platform Modalku in Indonesia, as well as the arrival of DBS’ pilot small business lending programme – which is powered by AMP Credit Technologies. But the arrival of the Hanwha-Dianrong joint venture is a potential game-changer, and we wouldn’t be surprised to see the South East Asian space heating up over the course of the year.
When news of the Hanwha partnership first broke, Mr. Htite offered the following thoughts:
"Dianrong always looks for high quality partners. A good partner for Dianrong is one that truly believes that Internet finance is the future. The partner should also be very large and have a good understanding of local traditions of finance in the location where we are considering. We like Hanwha a lot because they have been doing business in Korea for a very long time. The company is at a stage where its management believes that the next step is about to happen. We would like to be part of the next step."