LexinFintech Teams Up with Burger King to Expand Use of Installment Payments

LexinFintech Holdings Ltd. (“Lexin” or the “Company”) (Nasdaq: LX), a leading online consumer finance platform for educated young adults in China, announced that Fenqile, its e-commerce-driven installment finance platform, is teaming up with Burger King in a joint marketing campaign as part of its efforts to expand the use of installment payments.

The campaign, driven by a mutual focus to serve the young generation between Fenqile and Burger King, includes a stored value card worth RMB390, which can be bought with a discount of 28 percent and be used for food and beverage purchases at more than 800 Burger King stores across China from June 25 to September 25. The card, tailored exclusively for the campaign, is sold on Fenqile and customers can choose to pay for it with credit from different installment plans.

The cooperation is the first time that Burger King, one of the largest fast food hamburger chains in the world, has teamed up with a Chinese consumer finance company, as it explores new ways to engage customers and seeks to tap the huge potential from rising consumption fueled by the use of installment payments among China’s young people.
It also marks Fenqile’s latest initiative to expand the use of installment payments from online to brick-and-mortar stores, to better serve its customers, who are primarily educated young adults in China.

Fenqile began as a platform selling computers, smartphones and other consumer electronics, and has been increasing offerings by adding additional product categories to meet the growing needs of its customers. Customers can now buy a wide range of products on Fenqile, from cosmetics and personal care to plane and train tickets.

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The use of installment payments is on the rise in China, and will continue to grow in the next few years, as an increasingly large number of young people are gaining credit to improve their quality of life. Along with the expansion of consumer credit, the concept of making purchases on an installment basis is increasingly seen not just as a way to satisfy an urgent need, but also as a normal method of shopping, according to a January report published by Lexinwith support from its e-commerce partners including Apple, Dell, L’Oreal, and P&G.

Installment payments usage is shifting from a low-frequency form of consumption to a high-frequency form of routine consumption. The annual average number of orders per user paid for by installments on Fenqile has increased in the past three years, to 11.2 in 2017, from 10.6 in 2016, and 7.2 in 2015.

Increasingly, installment payments are shifting from the one-off purchase of bigger ticket items, to smaller purchases. The use of Installments are no longer limited to more costly consumer goods, such as computers and smartphones, but are increasingly involved in all aspects of life, such as travel and catering.

The joint campaign is supported by Lexin’s Hawkeye risk management engine, which will be in place to assess new customers’ creditworthiness.

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