Standard Chartered invests in Chinese online lender

The $207 million funding round in Dianrong.com is the largest ever investment in a Chinese online lender and the first equity investment by a commercial bank into a an internet lender, its claimed.

Chinese internet lender Dianrong has attracted an equity investment from Standard Chartered Bank, in the largest-ever funding round in the nation’s internet finance industry, the firm said.

The investment is also the first time a commercial bank has made a direct equity investment in an internet finance company, according to a statement.

Standard Chartered Bank and China Fintech Fund co-led the C-round financing, followed by Bohai Leasing. The total amount raised was $207 million.

Earlier this year, the firm received B-round funding from Tiger Global Management, also an investor in Alibaba and JD.com.

“Standard Chartered Private Equity (SCPE) rarely invests in early-stage companies; we typically focus on growth and late-stage companies,” Wei Zhu, managing director and global co-head of SCPE, commented. “Dianrong is quite an exceptional case,” he added.

Standard Chartered started looking for investment opportunities in the internet finance industry two years ago. “Standard Chartered has a different investment strategy than typical VC funds. We do not invest in a lot of companies, but emphasize on high quality investments and overall success rate; we would only like to invest in the best and most differentiated company in the industry,” Zhu said.

“Standard Chartered hopes to work with Dianrong to shape the development of the peer-to-peer lending industry in China and to lead innovations in the banking industry. Together we would create the ‘Bank of Tomorrow’,” the statement continued. 

  Dianrong was founded in 2012. In 2014 it launched a wealth management product called ‘Group Investing – TuanTuanZhuan’. It has exceeded RMB2.7 billion ($422.7 million: €376.4 million) in volume and earned RMB100 million in interest for Dianrong lenders, as of 25 August 2015.