Didi Chuxing launches fintech arm as it aims to recover from a challenging 2018
Chinese ride-sharing giant Didi Chuxing has moved into fintech by launching its own financial services as it aims to recover from a challenging 2018.
Didi has also launched a separate new app called ‘Didi Finance’, which allows users a one-stop financial services platform.
Starting from Wednesday (3 January), users were able to buy car insurance, personal loans and a crowdfunded medical insurance product on Didi’s app, The Financial Times reported. Didi has also launched a separate new app called ‘Didi Finance’, which allows users a one-stop financial services platform.
According to Didi, which is backed by Tencent, Baidu and Alibaba, the new financial services, were for an “era of new economy and flexible employment” and that some, such as medical insurance, would “lower the entry barrier for gig economy workers”.
In 2018, Didi received widespread criticism from the Chinese government and citizens after the deaths of two passengers. It then suspended services between 11pm and 5am until 15 September and introduced a panic button to link passengers directly with police and plans to tighten up driver background checks.
In addition, it launched a trial of a recording function, which will capture in-car audio from the entire journey and then upload an encrypted file to the company’s servers. The files will be stored for seven days before being deleted if no complaint is made. The service required passengers and drivers to provide authorisation for the recording of their voices.
Didi founder and chief executive Cheng Wei also issued a public apology and revealed the company had not made a profit in the six years since it launched and had recorded a loss of RMB 4bn ($585m) in the first half of 2018.
The company also saw Ofo, a bike-sharing start-up it has invested heavily in, fall apart as Ofo's founder is on a government blacklist for unpaid bills and millions of riders who placed deposits demanding their money back because of faulty bikes.
The new financial offering will see Didi compete against Alibaba’s Ant Financial and Tencent’s WeBank, while in South East Asia, Grab, a company that Didi has invested in, launched its fintech arm in 2018 which brought its group payments, rewards & loyalty, agent network, and financial services under an umbrella, as well as offer insurance products to its drivers and customers.