. Specifically, in 2017, 2018, and the first half of 2019, they accounted for 96.6%, 87.2%, and 72.3% of the total business, respectively.
The composition of Yongxiong’s revenue, click to see the big picture.
Hunan Yongxiong is highly dependent on upstream customers. According to the income generated by each period, the top five customers accounted for 99.2%, 90.2% and 79.2% of the total revenue in 2017, 2018 and the first half of 2019, respectively. (Note: The top five customer names are not disclosed. ).
It is also honest in the prospectus that if its business relationship with any of these major customers deteriorates or terminates, or if its customers cease operations due to legal, compliance or any other reason, they may Business, financial condition and results of operations have a material adverse effect.
The facts also prove this – because of the limited voice in front of customers, the commission commission is unstable, even falling: the average commission rate of Yongxiong in 2017, 2018 and 2019 is 44.3%, 39.8% and 35.3%.
03 The money still owed is still uncle
After observing the core financial indicators of the collection mode, it usually looks at three points: the return rate, the time of payment, and the cost. However, as the industry gradually integrates, the industry’s bad money is gradually being removed, and now it is necessary to add a top-of-the-line compliance risk.
There is a long-standing customary collection method in the industry—electric reminders (including intelligent collection), legal proceedings, and arbitration. In the actual operation process, it is necessary to seek balance among the above four points.
“All the money is owed to the uncle”, even if the laws and regulations are sound, such a situation is still a hidden rule of the industry. Once the collection method is improperly intensified, not only the rate of return will decline, but also the red line of compliance will be violated, resulting in an increase in operating costs.
Overdue payments are divided into three types, which are divided by overdue time, 2017-2022E, level (1-3 months), accounting for 5.6% of total overdue, secondary (bank 4-12 months; other internet finance Institutions 4-6 months) accounted for 18.6%, and the three-tier overdue (bank: 12 months or more, other Internet financial institutions: more than 6 months) accounted for 41.3%.
Hunan Yongxiong mainly made the third-level overdue collection: In the first half of 2019, Yongxiong successfully recovered 1.456 billion yuan of overdue payments, of which the three-level overdue accounted for 85.67%, which was 1.333 billion yuan.
According to iResearch data, there are more than 3,000 collection companies nationwide, and there are more than 1,000 credit card collection companies.
While Hunan Yongxiong ranked first with 10,915 collectors and credit card receivables overdue, its income sources have a tendency to differentiate, and the proportion of credit card collection business is gradually decreasing.
Because the domestic collection market is extremely fragmented, Yongxiong’s market share of overdue loans receivable is not as high as expected.
From 2013 to 2017, the nation’s overdue consumer loans increased from 468.6 billion yuan to 185 million yuan, which is expected to increase to 2.03 trillion yuan and 2.38 trillion yuan in 2018 and 2019 respectively.
The total amount of overdue loan assets won by Yongxiong on September 30, 2019 was 44.6 billion yuan. If the total overdue loan is estimated at 59.5 billion yuan, the market share is only 2.5%.
06 Service is highly replaceable
According to the prospectus, the collection method of Hunan Yongxiong is limited to remote (telephone and SMS) collection. Claiming to rely on internal control and evaluation of the arrears repayment situation, there is a corresponding AI speech recognition technology and big data analysis support.
In view of the fact that more than 80% (85.67%) of the asset packages in Hunan Yongxiong come from the most difficult to recover three-level overdue payment; then, with the support of AI and big data, the core indicator of the three-level overdue business – commission rate How is it?
Source: Yongxiong Prospectus, click to enlarge
As shown in the above picture, the three-level overdue payment, as the largest source of income for Yongxiong, the commission rate has been declining for nearly two years. Its prospectus explains that the commission rate is declining due to the period of arrears and the difficulty of recycling.
This reason is not enough to convince. The decline in the commission rate indicates that competition is fierce and its substitutability is high.
Remote collection is a selling point of Yongxiong. In fact, the three methods of analyzing collection are remote collection, which is only the lowest cost.
The prospectus also revealed that the company’s 10,000 collectors are very mobile. From the third-party recruitment channel “boss direct employment” can be observed that Yongxiong is recruiting a large number of asset collectors throughout the year.
At the same time, it is necessary to point out that the current media claimed Yongxiong assets.