Consumer Capital Group Profile
Consumer Capital Group, Inc. focuses on lending service for car dealerships in the People’s Republic of China (China).
The company primarily engages in the business of microfinancing services. It operates its direct microfinancing business through its variable interest entity (VIE), America Arki Network Service Beijing Co., Ltd. (Arki Network) and its subsidiaries, America Arki (Tianjin) Capital Management Partnership (Arki Capital), Arki (Tianjin) E-Commerce, Ltd. (Arki Tianjin E-Commerce) and Arki (Guangzhou) Investment Consulting Co. (Arki Guangzhou). The company offers car dealerships alternative financing means through risk-controlled private lending to meet their capital needs and develop their business. It offers advisory and risk assessment services to both lenders and borrowers to improve the efficiency of loan origination by financial institutions.
Business
Microfinancing
The company engages in microfinancing business through its VIE, Arki Network and its subsidiaries, Arki Capital and Arki Tianjin E-Commerce, to provide direct loans primarily to car dealerships based in Liaoning Province. Its relationship with Arki Network is governed by a series of contractual relationships among Arki Network, the shareholders of Arki Network, and two of its subsidiaries, Arki (Beijing) E-Commerce Technology Corp. (Arki E-Commerce) and America Arki (Fuxin) Network Management Co. Ltd. (America Arki). In June 2018, America Arki ceased operations and cancelled its registration records. Subsequent to the cessation of America Arki’s operations, the company’s relationship with Arki Network continues to be governed by the ongoing contractual arrangements with Arki E-Commerce.
Through Arki Network’s collaboration with China UnionPay Merchant Service (Liaoning) Co. Ltd (UnionPay Liaoning), Arki Capital provides private loans to borrowers (primarily, car dealerships) for a service fee of 5%, and Arki Network and UnionPay Liaoning act as intermediaries to facilitate the loan transactions. Arki Network charges a service fee of 3% of the loan proceeds, of which 0.5% is paid to UnionPay Liaoning.
UnionPay Liaoning is incentivized to recommend as majority borrowers to the company as possible as the additional service fees is a source of revenue for their operation. The company has a contractual arrangement with UnionPay to provide it with such information and related due diligence information on car dealers and their customers.
The company focuses its microfinancing business customer basis on car dealerships pre-screened by UnionPay Liaoning based on historical sales volume generated through bank card transactions using UnionPay’s system. Upon completion of the background check by Arki Network’s servicing team, Arki Capital provides short-term loans in the form of original issue discount to qualified borrowers with pre-set interest rate, terms and conditions.
Business Strategy
The company intends to implement two primary strategies to expand its market presence within the industry, which include to increase Arki Network’s lending capacity through the cash generated from operations and additional capital that the company is able to raise; and expand the company’s geographic coverage for both microfinancing and investment marketing business to major metropolitan areas, such as Beijing, Shanghai, Guangzhou through the establishment of sales force.
The company also intends to develop, through Arki Network and its subsidiary Arki Tianjin E-Commerce, an e-commerce online marketplace – Wan Cang World (www.wancang.org) where users could buy and sell art and antiques, including coins, jade, china paintings, jewelry, furniture, and others. It intends to provide a platform where the art could be showcased, appreciated and verified, exchanged and liquidated.
Intellectual Property
Domains: The company has one domain name, www.ccgusa.com. Arki Network holds the Internet content provider (ICP) license issued by the Beijing Communications Control Bureau No. 100852 in June 2013. The company has registered three Websites using this ICP license, including www.ccmus.com, www.bangnitou.net, and www.wancang.org. The domains www.ccmus.com and www.wancang.org were created for the company’s e-commerce business and www.bangnitou.net, which also has a corresponding mobile application, is created for its business of marketing investment opportunities.
Seasonality
The company experiences seasonality in its business, reflecting seasonal fluctuations in Internet usage and traditional personal consumption patterns, as its individual borrowers typically use their borrowing proceeds to finance their personal consumption needs. The company experiences lower transaction value on its online consumer finance marketplace during national holidays in China, primarily during the Chinese New Year holiday season in the first quarter (year ended December 2018) of each year.
Competition
The company’s major competitors include Yirendai, Ren Ren Dai and Lufax.
History
Consumer Capital Group, Inc. was incorporated in 2008.
