Document and Entity Information
Document and Entity Information | 12 Months Ended |
Dec. 31, 2023 shares | |
Document Type | 20-F |
Document Registration Statement | false |
Document Annual Report | true |
Document Period End Date | Dec. 31, 2023 |
Document Transition Report | false |
Document Shell Company Report | false |
Entity File Number | 001-37657 |
Entity Registrant Name | Yiren Digital Ltd. |
Entity Incorporation, State or Country Code | E9 |
Entity Address, Address Line One | 28/F, China Merchants Bureau Building |
Entity Address, Address Line Two | 118 Jianguo Road |
Entity Address, Address Line Three | Chaoyang District |
Entity Address, City or Town | Beijing |
Entity Address, Postal Zip Code | 100022 |
Entity Address, Country | CN |
Entity Common Stock, Shares Outstanding | 174,706,968 |
Entity Well-known Seasoned Issuer | No |
Entity Voluntary Filers | No |
Entity Current Reporting Status | No |
Entity Interactive Data Current | No |
Entity Filer Category | Non-accelerated Filer |
Entity Emerging Growth Company | false |
Document Financial Statement Error Correction [Flag] | false |
Document Accounting Standard | U.S. GAAP |
Entity Shell Company | false |
Auditor Name | Wei, Wei & Co., LLP |
Auditor Firm ID | 2388 |
Auditor Location | Flushing, New York |
Entity Central Index Key | 0001631761 |
Current Fiscal Year End Date | --12-31 |
Document Fiscal Year Focus | 2023 |
Document Fiscal Period Focus | FY |
Amendment Flag | false |
Business Contact | |
Contact Personnel Name | Na Mei |
City Area Code | 86 10 |
Local Phone Number | 5964-4552 |
Contact Personnel Email Address | ir@yiren.com |
Entity Address, Address Line One | 28/F, China Merchants Bureau Building |
Entity Address, Address Line Two | 118 Jianguo Road |
Entity Address, Address Line Three | Chaoyang District |
Entity Address, City or Town | Beijing |
Entity Address, Postal Zip Code | 100022 |
Entity Address, Country | CN |
American depositary shares | |
Title of 12(b) Security | American depositary shares (one American depositary share representing two ordinary shares, par value US$0.0001 per share) |
Trading Symbol | YRD |
Security Exchange Name | NYSE |
Ordinary shares, par value US$0.0001 per share | |
Title of 12(b) Security | Ordinary shares, par value US$0.0001 per share* |
No Trading Symbol Flag | true |
Security Exchange Name | NYSE |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS ¥ in Thousands, $ in Thousands | Dec. 31, 2023 CNY (¥) | Dec. 31, 2023 USD ($) | Dec. 31, 2022 CNY (¥) |
Assets including amounts of the consolidated variable interest entities (the "VIEs") and consolidated assets backed financing entities ("ABFE") (Note 2): | |||
Cash and cash equivalents | ¥ 5,791,333 | $ 815,692 | ¥ 4,271,899 |
Restricted cash | 267,271 | 37,644 | 88,796 |
Trading securities | 76,053 | 10,712 | |
Accounts receivable (net of allowance of RMB18,235 and RMB46,715 as of December 31, 2022 and 2023, respectively) | 499,027 | 70,287 | 221,004 |
Contract assets, net (net of allowance of RMB153,435 and RMB164,141 as of December 31, 2022 and 2023, respectively) | 978,051 | 137,756 | 626,739 |
Contract cost | 32 | 4 | 787 |
Prepaid expenses and other assets | 426,511 | 60,073 | 321,411 |
Loans at fair value | 677,835 | 95,471 | 54,049 |
Financing receivables (net of allowance of RMB40,735 and RMB51,858 as of December 31, 2022 and 2023, respectively) | 116,164 | 16,361 | 514,388 |
Held-to-maturity investments | 10,420 | 1,468 | 2,700 |
Available-for-sale investments | 438,084 | 61,703 | 972,738 |
Property, equipment and software, net | 79,158 | 11,149 | 77,256 |
Deferred tax assets | 73,414 | 10,340 | 84,187 |
Right-of-use assets | 23,382 | 3,293 | 33,909 |
Total assets | 10,276,916 | 1,447,473 | 8,536,095 |
Liabilities including amounts of the consolidated VIEs and the consolidated ABFE without recourse to the Company (Note 2): | |||
Accounts payable | 30,902 | 4,353 | 14,144 |
Deferred revenue | 54,044 | 7,612 | 65,539 |
Accrued expenses and other liabilities | 1,500,522 | 211,344 | 1,315,006 |
Secured borrowings | 0 | 767,900 | |
Deferred tax liabilities | 122,075 | 17,194 | 79,740 |
Lease liabilities | 23,648 | 3,331 | 35,229 |
Total liabilities | 2,191,367 | 308,648 | 2,505,282 |
Commitments and Contingencies (Note 18) | |||
Equity: | |||
Ordinary shares (US$0.0001 par value; 500,000,000 shares authorized; 199,299,342 and 200,648,440 shares issued as of December 31, 2022 and 2023, respectively; 178,577,768 and 174,706,968 shares outstanding as of December 31, 2022 and 2023, respectively) | 130 | 18 | 129 |
Treasury stock (2,161,574 and 7,381,472 shares as of December 31, 2022 and 2023, respectively) | (94,851) | (13,359) | (46,734) |
Additional paid-in capital | 5,171,232 | 728,353 | 5,160,783 |
Accumulated other comprehensive income | 23,669 | 3,333 | 7,765 |
Retained earnings | 2,985,369 | 420,480 | 908,870 |
Total equity | 8,085,549 | 1,138,825 | 6,030,813 |
Total liabilities and equity | 10,276,916 | 1,447,473 | 8,536,095 |
Related Party | |||
Assets including amounts of the consolidated variable interest entities (the "VIEs") and consolidated assets backed financing entities ("ABFE") (Note 2): | |||
Amounts due from related parties | 820,181 | 115,520 | 1,266,232 |
Liabilities including amounts of the consolidated VIEs and the consolidated ABFE without recourse to the Company (Note 2): | |||
Other liabilities | 14,414 | 2,030 | 227,724 |
Investors | |||
Liabilities including amounts of the consolidated VIEs and the consolidated ABFE without recourse to the Company (Note 2): | |||
Other liabilities | ¥ 445,762 | $ 62,784 | ¥ 0 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) ¥ in Thousands | Dec. 31, 2023 CNY (¥) shares | Dec. 31, 2023 $ / shares | Dec. 31, 2022 CNY (¥) shares | Dec. 31, 2022 $ / shares | Dec. 31, 2021 CNY (¥) |
CONSOLIDATED BALANCE SHEETS | |||||
Accounts receivable, allowance | ¥ | ¥ 46,715 | ¥ 18,235 | |||
Contract assets, allowance | ¥ | 164,141 | 153,435 | ¥ 350,686 | ||
Financing receivables, allowance | ¥ | ¥ 51,858 | ¥ 40,735 | |||
Ordinary shares: | |||||
Ordinary shares, par value (in dollars per share) | $ / shares | $ 0.0001 | $ 0.0001 | |||
Ordinary shares, authorized (in shares) | 500,000,000 | 500,000,000 | |||
Ordinary shares, issued (in shares) | 200,648,440 | 199,299,342 | |||
Ordinary shares, outstanding (in shares) | 174,706,968 | 178,577,768 | |||
Treasury stock, issued (in shares) | 7,381,472 | 2,161,574 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS ¥ in Thousands, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2023 CNY (¥) ¥ / shares shares | Dec. 31, 2023 USD ($) $ / shares shares | Dec. 31, 2022 CNY (¥) ¥ / shares shares | Dec. 31, 2021 CNY (¥) ¥ / shares shares | |
CONSOLIDATED STATEMENTS OF OPERATIONS | ||||
Net revenue (including revenue from related parties of RMB573,158, RMB411,010 and RMB141,595 for the years ended December 31,2021, 2022 and 2023, respectively) | ¥ 4,895,633 | $ 689,535 | ¥ 3,434,620 | ¥ 4,477,929 |
Operating costs and expenses: | ||||
Sales and marketing (including expenses from related parties of RMB1,548, RMB38 and RMB24 for the years ended December 31, 2021, 2022 and 2023, respectively) | (656,603) | (92,481) | (573,974) | (1,553,344) |
Origination, servicing and other operating costs (including costs from related parties of RMB354,985, RMB350,311 and RMB324,854 for the years ended December 31, 2021, 2022 and 2023, respectively) | (976,172) | (137,491) | (776,841) | (760,858) |
Research and development(including expenses from related parties of RMB85,893, RMB65,268 and RMB52,468 for the years ended December 31, 2021, 2022 and 2023, respectively) | (148,754) | (20,952) | (151,924) | (207,996) |
General and administrative (including expenses from related parties of RMB49,225, RMB35,368 and RMB19,567 for the years ended December 31, 2021, 2022 and 2023, respectively) | (231,135) | (32,555) | (271,794) | (298,244) |
Allowance for contract assets, receivables and others | (288,187) | (40,589) | (188,223) | (370,154) |
Total operating costs and expenses | (2,300,851) | (324,068) | (1,962,756) | (3,190,596) |
Other income/(expenses): | ||||
Interest (expenses)/income, net | 80,749 | 11,373 | (26,302) | (73,383) |
Fair value adjustments (loss)/gain | (50,171) | (7,066) | 18,900 | (37,442) |
Other income, net | 20,000 | 2,817 | 30,921 | 26,665 |
Total other (expenses)/income, net | 50,578 | 7,124 | 23,519 | (84,160) |
Income before provision for income taxes | 2,645,360 | 372,591 | 1,495,383 | 1,203,173 |
Income tax expenses | (565,163) | (79,601) | (300,512) | (170,189) |
Net income | ¥ 2,080,197 | $ 292,990 | ¥ 1,194,871 | ¥ 1,032,984 |
Basic net income per share | (per share) | ¥ 11.7692 | $ 1.6577 | ¥ 6.8397 | ¥ 6.1113 |
Weighted average number of ordinary shares outstanding, basic | 176,749,706 | 176,749,706 | 174,695,959 | 169,029,826 |
Diluted net income per share | (per share) | ¥ 11.6415 | $ 1.6397 | ¥ 6.8126 | ¥ 6.0554 |
Weighted average number of ordinary shares outstanding, diluted | 178,688,319 | 178,688,319 | 175,391,332 | 170,590,203 |
CONSOLIDATED STATEMENTS OF OP_2
CONSOLIDATED STATEMENTS OF OPERATIONS (Parenthetical) ¥ in Thousands, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 CNY (¥) | Dec. 31, 2022 CNY (¥) | Dec. 31, 2021 CNY (¥) | |
Related Party Transaction [Line Items] | |||
Net revenue | ¥ 4,895,633 | ¥ 3,434,620 | ¥ 4,477,929 |
Sales and marketing | 656,603 | 573,974 | 1,553,344 |
Origination, servicing and other operating costs | 976,172 | 776,841 | 760,858 |
Research and development expense | 148,754 | 151,924 | 207,996 |
General and administrative | 231,135 | 271,794 | 298,244 |
Related parties | |||
Related Party Transaction [Line Items] | |||
Net revenue | 141,595 | 411,010 | 573,158 |
Sales and marketing | 24 | 38 | 1,548 |
Origination, servicing and other operating costs | 324,854 | 350,311 | 354,985 |
Research and development expense | 52,468 | 65,268 | 85,893 |
General and administrative | ¥ 19,567 | ¥ 35,368 | ¥ 49,225 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME ¥ in Thousands, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2023 CNY (¥) | Dec. 31, 2023 USD ($) | Dec. 31, 2022 CNY (¥) | Dec. 31, 2021 CNY (¥) | |
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME | ||||
Net income | ¥ 2,080,197 | $ 292,990 | ¥ 1,194,871 | ¥ 1,032,984 |
Other comprehensive (loss)/income, net of tax of nil: | ||||
Foreign currency translation adjustment | (1,909) | (269) | 8,563 | (3,193) |
Unrealized (loss)/gain on available-for-sale investments | 17,813 | 2,509 | (12,351) | (2,362) |
Comprehensive income | ¥ 2,096,101 | $ 295,230 | ¥ 1,191,083 | ¥ 1,027,429 |
CONSOLIDATED STATEMENTS OF CO_2
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Parenthetical) - CNY (¥) ¥ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME | |||
Other comprehensive (loss)/income, net of tax of nil: | ¥ 0 | ¥ 0 | ¥ 0 |
CONSOLIDATED STATEMENTS OF CHAN
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY ¥ in Thousands, $ in Thousands | Ordinary shares, par value US$0.0001 per share CNY (¥) shares | Treasury stock CNY (¥) shares | Additional paid-in capital CNY (¥) | Accumulated other comprehensive income CNY (¥) | (Accumulated deficit)/ Retained earnings CNY (¥) | CNY (¥) shares | USD ($) shares |
Beginning balance at Dec. 31, 2020 | ¥ | ¥ 121 | ¥ 5,058,176 | ¥ 17,108 | ¥ (1,257,594) | ¥ 3,777,664 | ||
Beginning balance, issued (in shares) at Dec. 31, 2020 | 187,569,640 | ||||||
Beginning balance, Outstanding (in shares) at Dec. 31, 2020 | 167,965,710 | ||||||
Treasury stock, beginning balance at Dec. 31, 2020 | ¥ | ¥ (40,147) | ||||||
Treasury stock, beginning balance (in shares) at Dec. 31, 2020 | 1,043,930 | ||||||
Increase (Decrease) in Stockholders' Equity | |||||||
Share-based awards provided to employees | ¥ | ¥ 1 | 19,088 | 19,089 | ||||
Share-based awards provided to employees, issued (in shares) | 1,160,438 | ||||||
Share-based awards provided to employees, Outstanding (in shares) | 1,160,438 | ||||||
Share-based awards provided to employees of consolidated group of CreditEase | ¥ | ¥ 1 | 23,222 | (23,223) | ||||
Share-based awards provided to employees of consolidated group of CreditEase, issued (in shares) | 1,126,902 | ||||||
Share-based awards provided to employees of consolidated group of CreditEase, Outstanding (in shares) | 1,126,902 | ||||||
Repurchase of ordinary shares | ¥ | (2,750) | ||||||
Repurchase of ordinary shares (in shares) | (257,124) | ||||||
Repurchase of ordinary shares | ¥ | ¥ (2,750) | ||||||
Repurchase of ordinary shares (in shares) | 257,124 | ||||||
Foreign currency translation adjustment | ¥ | (3,193) | (3,193) | |||||
Unrealized gains on available-for-sale investments | ¥ | (2,362) | (2,362) | |||||
Net income | ¥ | 1,032,984 | 1,032,984 | |||||
Ending balance at Dec. 31, 2021 | ¥ | ¥ 123 | 5,100,486 | 11,553 | (247,833) | 4,821,432 | ||
Ending balance, issued (in shares) at Dec. 31, 2021 | 189,856,980 | ||||||
Ending balance, Outstanding (in shares) at Dec. 31, 2021 | 169,995,926 | ||||||
Treasury stock, ending balance at Dec. 31, 2021 | ¥ | ¥ (42,897) | ||||||
Treasury stock, ending balance (in shares) at Dec. 31, 2021 | 1,301,054 | ||||||
Increase (Decrease) in Stockholders' Equity | |||||||
Share-based awards provided to employees | ¥ | ¥ 2 | 22,133 | 22,135 | ||||
Share-based awards provided to employees, issued (in shares) | 3,035,692 | ||||||
Share-based awards provided to employees, Outstanding (in shares) | 3,035,692 | ||||||
Share-based awards provided to employees of consolidated group of CreditEase | ¥ | ¥ 4 | 38,164 | (38,168) | ||||
Share-based awards provided to employees of consolidated group of CreditEase, issued (in shares) | 6,406,670 | ||||||
Share-based awards provided to employees of consolidated group of CreditEase, Outstanding (in shares) | 6,406,670 | ||||||
Repurchase of ordinary shares | ¥ | ¥ (3,837) | (3,837) | |||||
Repurchase of ordinary shares (in shares) | (860,520) | ||||||
Repurchase of ordinary shares (in shares) | 860,520 | ||||||
Foreign currency translation adjustment | ¥ | 8,563 | 8,563 | |||||
Unrealized gains on available-for-sale investments | ¥ | (12,351) | (12,351) | |||||
Net income | ¥ | 1,194,871 | 1,194,871 | |||||
Ending balance at Dec. 31, 2022 | ¥ | ¥ 129 | 5,160,783 | 7,765 | 908,870 | ¥ 6,030,813 | ||
Ending balance, issued (in shares) at Dec. 31, 2022 | 199,299,342 | 199,299,342 | 199,299,342 | ||||
Ending balance, Outstanding (in shares) at Dec. 31, 2022 | 178,577,768 | 178,577,768 | 178,577,768 | ||||
Treasury stock, ending balance at Dec. 31, 2022 | ¥ | ¥ (46,734) | ¥ (46,734) | |||||
Treasury stock, ending balance (in shares) at Dec. 31, 2022 | (2,161,574) | 2,161,574 | 2,161,574 | ||||
Increase (Decrease) in Stockholders' Equity | |||||||
Share-based awards provided to employees | ¥ | ¥ 1 | 6,751 | ¥ 6,752 | ||||
Share-based awards provided to employees, issued (in shares) | 869,556 | ||||||
Share-based awards provided to employees, Outstanding (in shares) | 869,556 | ||||||
Share-based awards provided to employees of consolidated group of CreditEase | ¥ | 3,698 | (3,698) | |||||
Share-based awards provided to employees of consolidated group of CreditEase, issued (in shares) | 479,542 | ||||||
Share-based awards provided to employees of consolidated group of CreditEase, Outstanding (in shares) | 479,542 | ||||||
Repurchase of ordinary shares | ¥ | (48,117) | ||||||
Repurchase of ordinary shares (in shares) | (5,219,898) | ||||||
Repurchase of ordinary shares | ¥ | ¥ (48,117) | ||||||
Repurchase of ordinary shares (in shares) | 5,219,898 | ||||||
Foreign currency translation adjustment | (1,909) | (1,909) | $ (269) | ||||
Unrealized gains on available-for-sale investments | 17,813 | 17,813 | 2,509 | ||||
Net income | 2,080,197 | 2,080,197 | 292,990 | ||||
Ending balance at Dec. 31, 2023 | ¥ 130 | ¥ 5,171,232 | ¥ 23,669 | ¥ 2,985,369 | ¥ 8,085,549 | $ 1,138,825 | |
Ending balance, issued (in shares) at Dec. 31, 2023 | 200,648,440 | 200,648,440 | 200,648,440 | ||||
Ending balance, Outstanding (in shares) at Dec. 31, 2023 | 174,706,968 | 174,706,968 | 174,706,968 | ||||
Treasury stock, ending balance at Dec. 31, 2023 | ¥ (94,851) | ¥ (94,851) | $ (13,359) | ||||
Treasury stock, ending balance (in shares) at Dec. 31, 2023 | 7,381,472 | 7,381,472 | 7,381,472 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS ¥ in Thousands, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2023 CNY (¥) | Dec. 31, 2023 USD ($) | Dec. 31, 2022 CNY (¥) | Dec. 31, 2021 CNY (¥) | |
Cash Flows from Operating Activities: | ||||
Net income | ¥ 2,080,197 | $ 292,990 | ¥ 1,194,871 | ¥ 1,032,984 |
Adjustments to reconcile net income/(loss) to net cash provided by operating activities: | ||||
Depreciation and amortization | 7,116 | 1,002 | 26,430 | 43,236 |
Amortization of right-of-use assets | 18,325 | 2,581 | 26,401 | 96,714 |
Disposal of property, equipment and software | (133) | (19) | 5,103 | 2,610 |
Fair value adjustments gain/(loss) | 50,171 | 7,066 | (18,900) | 37,442 |
Share-based compensation | 6,752 | 951 | 22,135 | 19,089 |
Provision for contingent liability | (2,629) | |||
Allowance for contract assets, receivables and others | 288,187 | 40,589 | 188,223 | 370,154 |
Loss related to trading securities and other investments | 13,900 | 1,958 | ||
Changes in operating assets and liabilities | ||||
Accounts receivable | (306,504) | (43,170) | 68,584 | (185,777) |
Contract assets | (547,738) | (77,147) | 369,061 | (668,245) |
Contract cost | 755 | 107 | 9,172 | 55,570 |
Prepaid expenses and other assets | (168,597) | (23,746) | 4,013 | (82,165) |
Change in the consolidated ABFE related assets/liabilities | 52,356 | 7,374 | (640) | 17,528 |
Financing receivables | 50,401 | 7,099 | 7,300 | (81,483) |
Amounts due from/to related parties | 431,628 | 60,794 | (78,632) | (437,782) |
Deferred tax assets/liabilities | 53,108 | 7,480 | (109,594) | 84,937 |
Accounts payable | 16,759 | 2,360 | (4,921) | 9,162 |
Deferred revenue | (11,496) | (1,619) | 53,160 | (38,520) |
Accrued expenses and other liabilities | 155,206 | 21,860 | 109,825 | (30,148) |
Refund liabilities | (5,732) | (5,113) | ||
Lease liabilities | (19,380) | (2,730) | (16,429) | (79,372) |
Net cash provided by/(used in) operating activities | 2,171,013 | 305,780 | 1,849,430 | 158,192 |
Cash Flows from Investing Activities: | ||||
Purchase of property, equipment and software | (4,444) | (626) | (882) | (9,404) |
Disposal of property, equipment and software | 133 | 19 | 871 | 612 |
Purchase of held-to-maturity investments | (11,032,000) | (1,553,825) | (201,000) | (780,000) |
Redemption of held-to-maturity investments | 11,024,280 | 1,552,737 | 200,500 | 781,086 |
Purchase of available-for-sale investments | (3,386,062) | (476,917) | (2,056,000) | (341,234) |
Proceeds from disposal of available-for-sale investments | 3,926,509 | 553,037 | 1,254,285 | 334,942 |
Purchases of trading securities | (152,868) | (21,531) | ||
Disposal of trading securities | 72,864 | 10,263 | ||
Acquisition of subsidiaries | (5,051) | (711) | ||
Investment in loans at fair value | (1,494,096) | (210,439) | (56,147) | (60,201) |
Collection of principal of loans at fair value | 772,398 | 108,790 | 92,673 | 125,969 |
Disposal of financing receivables | 63,392 | 8,929 | 18,540 | |
Loan to related parties | (200,000) | |||
Origination of financing receivables | (44,017) | (6,200) | (935) | (1,825,473) |
Repayments of financing receivables | 359,007 | 50,565 | 1,000,654 | 1,427,196 |
Net cash (used in)/provided by investing activities | 100,045 | 14,091 | 52,559 | (346,507) |
Cash Flows from Financing Activities: | ||||
Principal payments to the consolidated ABFE | (7,461) | (1,051) | (85,586) | (71,861) |
Contribution from investors of the consolidated ABFE | 450,000 | 63,381 | 657 | |
Loans from related parties | 2,600 | |||
Principal payments of loans from related parties | (195,800) | (27,578) | (182,000) | (29,300) |
Loan from third parties | 575,900 | |||
Repayment of loan to a third party | (767,900) | (108,156) | (217,700) | (47,800) |
Repurchase of ordinary shares | (48,117) | (6,777) | (3,837) | (2,750) |
Net cash provided by/(used in) financing activities | (569,278) | (80,181) | (489,123) | 427,446 |
Effect of foreign exchange rate changes | (3,871) | (545) | 2,486 | (936) |
Net increase/(decrease) in cash and cash equivalents | 1,697,909 | 239,145 | 1,415,352 | 238,195 |
Cash, cash equivalents and restricted cash, beginning of year | 4,360,695 | 614,191 | 2,945,343 | 2,707,148 |
Cash, cash equivalents and restricted cash, end of year | 6,058,604 | 853,336 | 4,360,695 | 2,945,343 |
Supplemental disclosures of cash flow information: | ||||
Cash paid for income taxes | 165,176 | 23,265 | 78,872 | 63,313 |
Cash paid for interest | ¥ 62,533 | $ 8,808 | ¥ 121,698 | ¥ 85,261 |
CONSOLIDATED STATEMENTS OF CA_2
CONSOLIDATED STATEMENTS OF CASH FLOWS - Reconciliation to Amounts on Consolidated Balance Sheets ¥ in Thousands, $ in Thousands | Dec. 31, 2023 CNY (¥) | Dec. 31, 2023 USD ($) | Dec. 31, 2022 CNY (¥) | Dec. 31, 2022 USD ($) | Dec. 31, 2021 CNY (¥) | Dec. 31, 2020 CNY (¥) |
Reconciliation to amounts on the consolidated balance sheets: | ||||||
Cash and cash equivalents | ¥ 5,791,333 | $ 815,692 | ¥ 4,271,899 | ¥ 2,864,543 | ||
Restricted cash | 267,271 | 37,644 | 88,796 | 80,800 | ||
Total cash, cash equivalents, and restricted cash | ¥ 6,058,604 | $ 853,336 | ¥ 4,360,695 | $ 614,191 | ¥ 2,945,343 | ¥ 2,707,148 |
ORGANIZATION AND PRINCIPAL ACTI
ORGANIZATION AND PRINCIPAL ACTIVITIES | 12 Months Ended |
Dec. 31, 2023 | |
ORGANIZATION AND PRINCIPAL ACTIVITIES | |
ORGANIZATION AND PRINCIPAL ACTIVITIES | 1. ORGANIZATION AND PRINCIPAL ACTIVITIES Yiren Digital Ltd. (the “Company” or “Yiren Digital” or the “Parent Company”) was incorporated under the laws of the Cayman Islands in September 2014 by CreditEase Holdings (Cayman) Limited (“CreditEase”). The Company, its subsidiaries, the consolidated VIEs and the consolidated VIEs’ subsidiaries (collectively referred to as the “Group”) have been operating an advanced, AI-powered platform providing a comprehensive suite of financial and lifestyle services in China. The Group started its online consumer finance marketplace business in March 2012 as a business unit under the Group’s parent company, CreditEase, which remains the Group’s parent company and controlling shareholder. CreditEase incorporated the Company in the Cayman Islands to be the Group’s holding company in September 2014.The Company established a wholly owned subsidiary in Hong Kong, YouRace Digital Holdings HK Limited (formerly known as Yiren Digital Hong Kong Limited), or YouRace HK, in October 2014, and YouRace HK further established YouRace Hengchuang Technology Development (Beijing) Co., Ltd. (formerly known as Yiren Hengye Technology Development (Beijing) Co., Ltd.), or YouRace Hengchuang, its wholly owned subsidiary in China, in January 2015. YouRace HK further established Chongqing Hengyuda Technology Co., Ltd., or Hengyuda, its wholly owned subsidiary in China, in March 2016. As the PRC laws and regulations prohibit or restrict foreign ownership of the companies where the PRC operating licenses are required, the Company, via its wholly-owned subsidiaries in the PRC, YouRace Hengchuang and Hengyuda, entered into a series of agreements with Yiren Financial Information Service (Beijing) Co., Ltd.(“Yiren Financial Information”) and CreditEase Puhui Information Consultant (Beijing) Co., Ltd. (“Creditease Puhui”) and their shareholders. Consequently, YouRace Hengchuang and Hengyuda became the primary beneficiary of Yiren Financial Information and CreditEase Puhui and consolidate Yiren Financial Information and CreditEase Puhui (see VIE arrangements in Note 2). Starting from 2015, the Group began to expand its investor base from individual investors to institutional investors, who invest in the loans from the Group’s platform through a series of arrangements among assets backed financial entities. The Group consolidated such assets backed financial entities if the Group is considered as their primary beneficiary. Refer to Note 2 for further details. As of March 31, 2019, the business of unsecured and secured consumer lending, operated by CreditEase Puhui, CreditEase Huimin Investment Management (Beijing) Co., Ltd. (“Huimin”) and its subsidiaries, as well as the Zhiwang wealth business operated by CreditEase Zhuoyue Wealth Investment Management (Beijing) Co., Ltd. (“Zhuoyue”) have been transferred to the Group. In May 2019, the Group also acquired Dekai Yichuang Asset Management (Shenzhen) Co., Ltd. (“Dekai Yichuang”, a consolidated VIE of CreditEase) and its subsidiaries from CreditEase to further expand its service lines. The Group acquired, through Yiren Financial Information, Hexiang Insurance Brokerage Co. Ltd. (“Hexiang Insurance”) and its shareholders and wholly owned subsidiary, in April 2020. Hexiang Insurance has been operating our insurance brokerage business since then. On December 31, 2020, as a result of a business restructuring, the Group disposed its online consumer lending platform targeting individual investors as the funding source to (“Disposed Business”) CreditEase. As of December 31, 2023, the Company’s principal subsidiaries, the consolidated VIEs and the consolidated VIEs’ subsidiaries are as follows: Date of Place of Percentage incorporation/ incorporation/ of legal establishment establishment ownership Principal activities Wholly owned subsidiaries YouRace HK October 8, 2014 Hong Kong 100 % Investment holding YouRace Hengchuang January 8, 2015 PRC 100 % Provision of consultancy service, information technology support and technology-enabled borrower acquisition and facilitation services Hengyuda March 21, 2016 PRC 100 % Provision of services relating to IT, system maintenance and customer support Yiren Information Consulting (Beijing) Co., Ltd.(“Yiren Information”) August 10, 2017 PRC 100 % Provision of borrower acquisition and referral services to institutional funding providers Variable interest entities and its subsidiaries Yiren Financial Information October 13, 2016 PRC Provision of membership services CreditEase Puhui March 3, 2011 PRC Provision of borrower acquisition and borrowers related customer maintenance services Haijin Yichuang Financial Leasing Co., Ltd. (“Yichuang Financial Leasing”) March 22, 2017 PRC Provision of services for financing lease business Hexiang Insurance September 28, 2011 PRC Provision of services for insurance brokerage business |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended |
Dec. 31, 2023 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of presentation The consolidated financial statements of the Company have been prepared in conformity with accounting principles generally accepted in the United States of America (GAAP). Basis of consolidation The consolidated financial statements include the financial statements of the Company, its wholly-owned subsidiaries, and the consolidated VIEs and the consolidated VIEs’ subsidiaries. All inter-company transactions and balances have been eliminated upon consolidation. VIEs The VIE arrangements In order to comply with the PRC laws and regulations which prohibit or restrict foreign control of companies involved in provision of value-added telecommunication services and other restricted businesses, the Company operates substantially all of its business through its VIEs. The Company through its wholly owned subsidiaries (Foreign Owned Subsidiaries, the “FOS”) located in the PRC entered into a series of contractual agreements with the VIEs and their shareholders. Through the contractual agreements below, the Company has (1) the power to direct the activities that most significantly affect the economic performance of the VIEs, and (2) the right to receive the economic benefit of the VIEs that could potentially be significant to the VIEs. As a result, the shareholders of the VIEs lack the power to direct the activities of the VIEs that most significantly impact the entity’s economic performance, the obligation to absorb the expected losses, and the right to receive the expected residual returns of the entity. Accordingly, the Company is considered as the primary beneficiary of the VIEs, and the Company has consolidated the financial results of the VIEs and their subsidiaries in its consolidated financial statements. The Group’s principal VIEs that are material to the Group’s business and operations are Hexiang Insurance, Yiren Financial Information and CreditEase Puhui as of December 31, 2022 and 2023. In concluding that the Company is the primary beneficiary of the VIEs, the Company believes that the FOS’s rights under the terms of the exclusive option agreements provide it with a substantive kick out right. More specifically, the Company believes the terms of the exclusive option agreements are valid, binding and enforceable under the PRC laws and regulations currently in effect. A simple majority vote of the Company’s board of directors is required to pass a resolution to exercise the FOS’s rights under the exclusive option agreements, for which consent of the shareholders of the VIEs is not required. The FOS’s rights under the exclusive option agreements give the Company the power to control the shareholders of the VIEs and thus the power to direct the activities that most significantly impact the VIEs’ economic performance. In addition, the FOS’s rights under the powers of attorney also reinforce the Company’s abilities to direct the activities that most significantly impact the VIEs’ economic performance. The Company also believes that this ability to exercise control ensures that the VIEs will continue to execute and renew service agreements and pay service fees to the Company. The exclusive business cooperation agreements will be terminated upon the expiration of the operation term of either party if the application for renewal of its operation term is not approved by the relevant government authorities. As a result, the Company believes that it has the rights to receive substantially all of the economic benefits from the VIEs. ● 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES — continued Basis of consolidation — continued VIEs — continued The VIE arrangements Power of Attorney Exclusive Option Agreements Equity Interest Pledge Agreements ● Exclusive Business Cooperation Agreements During the term of exclusive business cooperation agreements, both the FOS and the VIEs shall renew their operation terms prior to the expiration thereof so as to enable the exclusive business cooperation agreements to remain effective. The exclusive business cooperation agreements shall be terminated upon the expiration of the operation term of either the FOS or the VIEs, if the application for renewal of their operation terms is not approved by relevant government authorities. In addition, the shareholders of the VIEs have granted an irrevocable and exclusive option to the FOS to purchase any or all of the assets and businesses of the VIEs at the lowest price permitted under the PRC law. The agreements may be terminated only at the option of the FOS and the VIEs have no authority to terminate the exclusive business cooperation agreements. ● Agreements that provide the FOS with the option to purchase the equity interest in the VIEs Loan Agreements 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES — continued Basis of consolidation — continued VIEs — continued The VIE arrangements Risks in relation to the VIE structure The Company believes that the contractual arrangements with the VIEs and their current shareholders are in compliance with the PRC laws and regulations and are legally enforceable. However, uncertainties in the PRC legal system could limit the Company’s ability to enforce the contractual arrangements. If the legal structure and contractual arrangements were found to be in violation of the PRC laws and regulations, the PRC government could: ● Revoke the business and operating licenses of the FOS and the VIEs; ● Discontinue or restrict the operations of any related-party transactions among the FOS and the VIEs; ● Impose fines or other requirements on the FOS and the VIEs; ● Require the Company or the FOS and the VIEs to revise the relevant ownership structure or restructure operations; ● Restrict or prohibit the Company’s use of the proceeds of the additional public offering to finance the Company’s business and operations in the PRC; ● Shut down the Company’s servers or block the Company’s online platform; ● Discontinue or place restrictions or onerous conditions on the Company’s operations; and/or ● Require the Company to undergo a costly and disruptive restructuring. The Company’s ability to conduct its business may be negatively affected if the PRC government were to carry out any of the aforementioned actions. As a result, the Company may not be able to consolidate the VIEs in its consolidated financial statements as it may lose the ability to exert effective control over the VIEs and their shareholders, and it may lose the ability to receive economic benefits from the VIEs. The interests of the shareholders of the VIEs may diverge from that of the Company and that may potentially increase the risk that they would seek to act contrary to the contractual terms, for example by influencing the VIEs not to pay the service fees when required to do so. The Company cannot assure that when conflicts of interest arise, the shareholders of the VIEs will act in the best interests of the Company or that conflicts of interests will be resolved in the Company’s favor. Currently, the Company does not have existing arrangements to address potential conflicts of interest the shareholders of the VIEs may encounter in its capacity as beneficial owners and directors of the VIEs, on the one hand, and as beneficial owners and directors of the Company, on the other hand. The Company believes the shareholders of the VIEs will not act contrary to any of the contractual arrangements and the exclusive option agreements provide the Company with a mechanism to remove the current shareholders of the VIEs should they act to the detriment of the Company. The Company relies on certain current shareholders of the VIEs to fulfill their fiduciary duties and abide by laws of the PRC and act in the best interest of the Company. If the Company cannot resolve any conflicts of interest or disputes between the Company and the shareholders of the VIEs, the Company would have to rely on legal proceedings, which could result in disruption of its business, and there is substantial uncertainty as to the outcome of any such legal proceedings. 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES — continued Basis of consolidation VIEs — continued Risks in relation to the VIE structure The following financial statement amounts and balances of the consolidated VIEs and the consolidated VIEs’ subsidiaries were included in the consolidated financial statements after elimination of intercompany transactions and balances: December 31, December 31, 2022 2023 RMB RMB Assets Cash and cash equivalents 2,795,805 3,362,736 Trading securities — 76,053 Accounts receivable 100,756 56,735 Contract assets, net 107,679 154,384 Contract cost 652 3 Prepaid expenses and other assets 114,310 45,781 Financing receivables 514,388 113,951 Amounts due from related parties 911,432 447,891 Available-for-sale investments 600,000 — Property, equipment and software, net 62,979 61,735 Deferred tax assets 84,096 73,338 Right-of-use assets 10,474 10,659 Total assets 5,302,571 4,403,266 Liabilities Accounts payable 9,196 18,211 Amounts due to related parties 214,346 6,586 Deferred revenue 9,488 15 Accrued expenses and other liabilities 1,131,504 1,243,490 Secured borrowing 767,900 — Deferred tax liabilities 17,273 20,019 Lease liabilities 9,311 9,749 Total liabilities 2,159,018 1,298,070 Years ended December 31, 2021 2022 2023 RMB RMB RMB Net revenue 3,192,329 1,821,561 1,623,596 Net income 752,164 424,834 351,373 Years ended December 31, 2021 2022 2023 RMB RMB RMB Net cash (used in)/provided by operating activities (236,406) 1,151,656 1,013,875 Net cash (used in)/provided by investing activities (393,659) 417,535 906,485 Net cash provided by/(used in) financing activities 501,400 (399,700) (963,700) 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES — continued Basis of consolidation — continued VIEs — continued Risks in relation to the VIE structure In accordance with the VIE contractual arrangements, the FOS have the power to direct activities of the VIEs, and can have assets transferred out of the VIEs. There are no consolidated VIEs’ assets that are collateral for the VIEs’ obligations and can only be used to settle the VIEs’ obligations. There are no creditors (or beneficial interest holders) of the VIEs that have recourse to the general credit of the Company. There are no terms in any arrangements, considering both explicit arrangements and implicit variable interests, which require the Company or its subsidiaries to provide financial support to the VIEs. However, if the VIEs ever need financial support, the Company or its subsidiaries may, at its option and subject to statutory limits and restrictions, provide financial support to its VIEs through loans to the shareholders of the VIEs or entrustment loans to the VIEs. Relevant PRC laws and regulations restrict the VIEs from transferring a portion of their net assets, equivalent to the balance of their paid-in capital, capital reserve and statutory reserves, to the Company in the form of loans and advances or cash dividends. Please refer to Note 17 for disclosure of restricted net assets. Consolidated ABFE As part of the Group’s strategy to expand its investor base from individual investors to institutional investors, the Group established a business relationship with certain trusts or Asset Backed Special Plan (“ABS plan”), collectively referred to as consolidated assets backed financing entities or ABFE, which were administered by third-party trust companies. The ABFE were set up to invest solely in the loans facilitated by the Group on its platform to provide returns to the beneficiaries of the trusts through interest payments made by the borrowers. The Group provides loan facilitation and post-origination services to the ABFE. The Group also has power to direct the activities that have most significant impact on the economic performance of the ABFE by providing the loan servicing and default loan collection services of the ABFE. Through the transaction fees charged, guarantee deposit, and direct investment, the Group has the right to receive benefits or bear losses from the ABFE that could potentially be significant to the ABFE. The Group holds significant variable interest in the ABFE through the transaction fees charged, guarantee provided in the form of guarantee deposit, or direct investment. Accordingly, the Company is considered the primary beneficiary of the ABFE and has consolidated the ABFE’s assets, liabilities, results of operations, and cash flows in the consolidated financial statements. The assets of the ABFE are not available to creditors of the Company. In addition, the investors of the ABFE have no recourse against the assets of the Company. 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES — continued Consolidated ABFE — continued The following financial statement amounts and balances of the consolidated ABFE were included in the consolidated financial statements after elimination of intercompany transactions and balances: December 31, December 31, 2022 2023 RMB RMB Assets Restricted cash 88,796 267,271 Prepaid expenses and other assets 532 5,942 Loans at fair value 54,049 288,764 Held-to-maturity investments 2,300 10,420 Total assets 145,677 572,397 Liabilities Accounts payable 150 1,023 Amount due to related party 4,603 1,517 Payable to investors at fair value — 445,762 Accrued expenses and other liabilities 72 2,142 Total liabilities 4,825 450,444 Years ended December 31, 2021 2022 2023 RMB RMB RMB Net (loss)/income (38,720) 17,949 (68,024) Years ended December 31, 2021 2022 2023 RMB RMB RMB Net cash provided by/(used in) operating activities 17,016 (1,434) 211,185 Net cash provided by/(used in) investing activities 65,576 34,976 (900,142) Net cash (used in)/provided by financing activities (71,204) (85,587) 818,305 All assets of the consolidated ABFE are collateral for the consolidated ABFE’s obligations and can only be used to settle the consolidated ABFE’s obligations. Use of estimates The preparation of the financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from such estimates. Significant accounting estimates are used for, but not limited to, revenue recognition and its related accounts, allowance for accounts receivable and contract assets, allowance for financing receivable, guarantee liabilities, fair value measurement of loans at fair value, payable to investors at fair value, available-for-sale investments, depreciable lives of property, equipment and software, the discount rate for leases, consolidation of the VIEs, share-based compensation and income tax. Actual results may differ materially from those estimates. 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES — continued Revenue The majority of the Group’s revenue for the years ended December 31, 2021, 2022 and 2023 were generated from the PRC. The following table illustrates the disaggregation of revenue in 2021, 2022 and 2023 under Accounting Standards Codification (“ASC”) 606, “Revenue from Contracts with Customers”. 2021 2022 2023 RMB RMB RMB Financial services business: Loan facilitation services 2,105,776 1,362,685 2,240,852 Post origination services 174,255 204,336 17,203 Financing services 524,840 278,783 55,975 Others 379,431 113,928 201,089 Subtotal 3,184,302 1,959,732 2,515,119 Insurance brokerage business: Insurance brokerage services 755,691 731,797 963,822 Subtotal 755,691 731,797 963,822 Consumption & lifestyle business and others: Electronic commerce services 33,114 302,896 1,267,104 Others 504,822 440,195 149,588 Subtotal 537,936 743,091 1,416,692 Total net revenue 4,477,929 3,434,620 4,895,633 (a) Financial services business: Revenue from loan facilitation and post-origination services The Group provides services as an online marketplace connecting borrowers and investors. The investors used to consist of individual investors and institutional investors. In 2020, the Group ceased to facilitate new loans funded by individual investors. The Group provides loan facilitation services, guarantee services and post-origination services (e.g. cash processing, collection for some lenders and SMS services). The Group has determined that it is not the investor or borrower in the loan origination and repayment process, but acts as an agent to bring the investor and the borrower together. Except for loans and payable to investors in the consolidated ABFE, loans and lease receivables arising from direct financing leases issued by the Group, the Group does not record the loans receivable or payable arising from the loans facilitated between the investors and borrowers on its platform. Previously, transaction fees were charged from borrowers directly through either upfront charges, monthly payments, or a combination of both methods. After stopping the facilitation of new loans funded by individual investors, the Group only collects transaction fees (including loan facilitation service fees and post-origination service fees) from third party funding partners, and guarantee companies, if any, on pre-agreed schedules. The Group also receives service fees contingent on future events (e.g., penalty fees for loan prepayment and late payment). 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES — continued Revenue — continued Revenue from loan facilitation and post-origination services— continued The Group determines its customers to be both the investors and borrowers. The Group assesses ability and intention to pay the service fees of both borrowers and investors when they become due and determines if the collection of the service fees is probable, based on historical experiences as well as the credit due diligence performed on each borrower prior to loan origination. While the post-origination services are within the scope of ASC 860, ASC 606 revenue recognition model is applied due to the lack of definitive guidance in ASC 860. The loan facilitation services and post-origination services are two separate performance obligations under ASC 606, as these two deliverables are distinct in that customers can benefit from each service on its own and the Group’s promises to deliver the services are separately identifiable from each other in the contract. The Group determines the transaction price of loan facilitation services and post-origination services to be the service fees chargeable from the borrowers, net of value-added tax. The transaction price includes variable consideration in the form of prepayment risk of the borrowers. The Group reflects, in the transaction price, the borrower prepayment risk and estimates variable consideration for these contracts using the expected value approach on the basis of historical information and current trends of the prepayment percentage of the borrowers. The transaction price is allocated amongst the guarantee services, if any, and the two performance obligations described above. The Group first allocates the transaction price to the guarantee liabilities, if any, in accordance with ASC 460, Guarantees, which requires the guarantee to be measured initially at fair value based on the stand ready obligation. The remaining considerations are then allocated to the loan facilitation services and post-origination services using their relative standalone selling prices consistent with the guidance in ASC 606. The Group does not have observable standalone selling price information for the loan facilitation services or post-origination services because it does not provide loan facilitation services or post-origination services on a standalone basis. There is no direct observable standalone selling price for similar services in the market that is reasonably available to the Group. As a result, the estimation of standalone selling price involves significant judgments. The Group uses expected cost plus margin approach to estimate the standalone selling prices of loan facilitation services as the basis of revenue allocation. In estimating its standalone selling price for the loan facilitation services, the Group considers the cost incurred to deliver such services, profit margin for similar arrangements, customer demand, effect of competitors on the Group’s services, and other market factors. However, for post-origination services, given the main services are about loan collecting and cash processing, the Group can refer to other companies performing the same services, therefore a direct observable standalone selling price for similar services in the market is available to the Group. For each type of the services, the Group recognizes revenue when (or as) the entity satisfies the service/performance obligation by transferring a promised service to a customer. Revenues from loan facilitation are recognized at the time a loan is originated between the investor and the borrower and the loan principal is transferred to the borrower, at which time the facilitation service is considered completed. Revenues from post-origination services are recognized on a straight-line basis over the term of the underlying loans as the services are provided. Revenues from guarantee services, if any, are recognized amortized during the guarantee term. Remaining performance obligations represents the amount of the transaction price for which services have not been performed under post-origination services. The Group collects service fees monthly, and used to collect upfront or both. For upfront fees that are partially refundable to the borrowers, the Group estimates the refund based on historical prepayment probability and the corresponding predetermined refundable amount, and records corresponding refund liabilities upon receiving such fees. The aggregate amounts of the transaction price allocated to performance obligations that are unsatisfied pertaining to post-origination services were RMB12.5 million and RMB3.6 million as of December 31, 2022 and 2023, respectively, among which approximately 99% and 100% of the remaining performance obligations will be recognized over the following 12 months, respectively and with the remainder recognized thereafter. 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES — continued Revenue — continued Other revenue of financial services business Other revenue of financial service business includes referral service fees, penalty fees for loan prepayment and late payment and other service fees, such as technical service provided to the Disposed Business, guarantee services and value - added services for auto - secured loans. The Group refers potential borrowers to third-party companies and related parties and charges them fixed rate on certain basis (principal amount, click amount and etc.).Referral services revenue is recognized when successful referrals were completed by the Group. The penalty fees is based on a certain percentage of past due amounts in case of late payment or a certain percentage of the contract amounts in case of prepayment and the Group recognizes the relevant revenue when the fees are received. The Group provide system maintenance service to the Disposed Business and the technical service revenue is recognized over the contract term. Guarantee service fees are released from guarantee liability on a straight - line basis over the term of the guarantee. The Group also provide value - added services for auto - secured loans, mainly including GPS installation service. The revenue was recognized after the completion of the installation services. (b) Insurance brokerage business: Revenue from insurance brokerage services The Group provides insurance brokerage services selling various health and life insurance products and property and casualty insurance products on behalf of insurance companies. As an agent of the insurance companies, the Group sells insurance policies on behalf of the insurance companies and earns brokerage commissions determined as a percentage of premiums paid by the insured, including premiums paid upon renewals. The Group has identified its promise to sell insurance policies on behalf of the insurance companies as the performance obligation in its contracts with the insurance companies. The Group’s performance obligation to the insurance company is satisfied and commission revenue, including renewal commission revenue, is recognized at the point in time when an insurance policy becomes effective. The renewal commission revenue is recognized based on the projected renewal rate. The following table provides the amount of the disaggregation of revenue in 2021 2022 and 2023: 2021 2022 2023 RMB RMB RMB Insurance brokerage services: Life and health insurance business 515,436 420,273 551,809 Property & casualty insurance business 240,255 311,524 412,013 Total 755,691 731,797 963,822 The terms for health and life insurance products sold by the Group vary and are typically five The Group determines the transaction price of its contracts by estimating commissions that the entity expects to be entitled to over the premium collection term of the policy based on assumption about future customer behavior and market conditions. The Group makes estimates for the renewal rate based on the historical experience, reasonable and supportable forecasts of policyholders’ behavior, current economic conditions, and other contributing factors. Such estimates are ‘constrained’ in accordance with ASC 606. That is, the Group uses the expected value method and only includes estimated amounts in the transaction price to the extent it is probable that a significant reversal of cumulative revenue recognized for such transactions will not occur. 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES — continued Revenue — continued (c) Consumption & lifestyle business and others: Revenue from electronic commerce services The Group evaluates whether it is appropriate to record the gross amount of product sales and related costs or the net amount earned as commissions. When the Group is a principal, its performance obligation is to transfer promised goods or services to customers. For arrangements where the Group controls the goods or services before they are transferred to the customers as a principal, as it is primarily responsible for fulfilling the promise to provide the goods or services, is subject to inventory risk, and has discretion in establishing prices, revenue is recorded on a gross basis. As the goods or services generally sold with a right of return, the sales revenue is recognized when the products are delivered and not returned within the 7-day When the Group is an agent, its performance obligation is to facilitate third-party merchants in fulfilling their performance obligation for specified goods or services. Upon successful sales, the Group charges the third-party merchants a fixed rate commission based on the sales amount. The revenue is recognized on a net basis at the point of 7 days after delivery of products. The Group also provides a variety of non-physical products to fulfill our customers’ diverse consumption demands in different life scenarios, including upgraded membership services with more flexible pricing and enriched offerings, such as popular video streaming platform accounts and healthcare products and services. Revenues generated by the Group from these businesses are recorded under “e-commerce service income” when the performance obligation is satisfied. For the annual and quarter membership cards, the receipt of premium membership fees is initially recorded as “Deferred Revenue” and membership fees are recognized ratably over the terms of the membership cards as the Group’s performance obligation is satisfied over time under “e-commerce service income.” In 2022 and 2023, the revenue generated from the Group’s operations as a principal accounted for 99.1% and 99.7% of total e - commerce revenue, respectively. As of December 31, 2022 and 2023, the inventory balance related to e - commerce revenue were immaterial. Other revenue of other business Other revenue of other Contract assets Under ASC 606, contract assets represent the Group’s rights to consideration in exchange for services that the Group has transferred to the customer before payment is due. For the financial service business, the Group’s rights to consideration for the monthly fees related to facilitation services are conditional on the borrowers’ actual payment, as the borrowers have the rights to early terminate the loan contracts prior to the loan maturity and are not obligated to pay the remaining monthly fees. As such, the Group records a corresponding contract assets for the monthly service fees allocated to loan facilitation services and post-origination services that have already been delivered in relation to loans facilitated on the Group’s platform when recognizing revenue from loan facilitation services and post-origination services. For insurance brokerage services, contract assets are recorded for arrangements when the Group has provided the services but for which the related payments are not yet due. Contract assets are attributable to the brokerage commission that is contingent upon the future premium payment of the policy holders. 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES — continued Revenue — continued Contract assets — continued The facilitation service monthly fee that are past the payment due date but have not been paid are reclassified to accounts receivable. The Group only recognizes contract assets to the extent that the Group believes it is probable that it will collect substantially all of the consideration to which it will be entitled in exchange for the services transferred to the customer. The contract assets, net of allowance are RMB626,739 and RMB978,051 as of December 31, 2022 and 2023, respectively. Per ASC 606-10-45-3, an entity shall assess a contract asset for impairment in accordance with Topic 310 on receivables. Contract assets are stated at the historical carrying amount net of write offs and allowance for uncollectible accounts. In determining whether an impairment loss should be recorded in the financial statements, the Group makes judgements as to whether there is any observable data indicating that there is a measurable decrease in the estimated future cash flows from contract assets. This evidence may include observable data indicating that there has been an adverse change in the borrower’s credit risk, or national or local economic conditions that correlate with defaults on loans. When contract assets are assessed for impairment, the Group uses estimates based on the historical borrower’s credit risk. The historical borrower’s credit risk is adjusted on the basis of the relevant observable data that reflects current economic conditions. The Group regularly reviews the methodology and assumptions used for estimating the amount of collectable contract assets. Contract assets are identified as uncollectible if any repayment of the underlying loan is 90 days past due, and no other factor evidences the possibility of collecting the delinquent amounts. The Group will write off contract assets and corresponding allowance if any repayment of the underlying loan is 90 days past due. Contract assets as of December 31, 2022 and 2023 are as follows: As of December 31, 2022 As of December 31, 2023 RMB RMB Contract assets 780,174 1,142,192 Allowance (153,435) (164,141) Contract assets, net 626,739 978,051 The following table presents the movement of allowance for contract assets for the years ended December 31, 2022 and 2023: Year ended December 31, 2022 Year ended December 31, 2023 RMB RMB Balance at beginning of the year 350,686 153,435 Allowance for contract assets 110,888 196,426 Write-off (308,139) (185,720) Balance at end of the year 153,435 164,141 Contract cost The Group pays commissions for successful referring of borrowers to the Group. The commissions paid based on successful referrals are considered as contract acquisition cost, and are capitalized when the commiss |
PREPAID EXPENSES AND OTHER ASSE
PREPAID EXPENSES AND OTHER ASSETS | 12 Months Ended |
Dec. 31, 2023 | |
PREPAID EXPENSES AND OTHER ASSETS | |
PREPAID EXPENSES AND OTHER ASSETS | 3. PREPAID EXPENSES AND OTHER ASSETS December 31, December 31, 2022 2023 RMB RMB Deposits (i) 162,885 327,987 Funds receivable from external payment network providers (ii) 46,141 41,354 Prepaid expenses 4,976 17,247 Interest receivable 9,537 14,905 Guarantee receivable 3,021 2,890 Funds receivable for disposal of financing receivables 62,444 1,989 Goodwill (iii) 4,778 4,778 Others 27,629 15,361 Total 321,411 426,511 (i) As of December 31, 2022 and 2023, the balance of deposit mainly includes the business cooperation deposit of RMB 150 million and RMB 319 million, respectively. (ii) The Group opened accounts with external online payment service providers to collect the loan principal, interest and service fees. The balance of funds receivable from external payment network providers mainly includes accumulated amounts of service fees received at the balance sheet date, which was collected subsequently. (iii) In April 2020, the Group acquired an insurance brokerage licensee company for total consideration of RMB 15.5 million. The purchase price allocated to the fair value of assets acquired and liabilities assumed were RMB 53.8 million and RMB 38.3 million, respectively. RMB 4.8 million of goodwill was recognized in this acquisition. The Group did no t record any impairment of goodwill during the years ended December 31, 2021, 2022 and 2023. |
FAIR VALUE OF ASSETS AND LIABIL
FAIR VALUE OF ASSETS AND LIABILITIES | 12 Months Ended |
Dec. 31, 2023 | |
FAIR VALUE OF ASSETS AND LIABILITIES | |
FAIR VALUE OF ASSETS AND LIABILITIES | 4. Fair Value of Assets and Liabilities Assets and Liabilities Recorded at Fair Value The Group does not have assets or liabilities measured at fair value on a non-recurring basis. The fair value hierarchy for assets and liabilities measured at fair value on a recurring basis subsequent to initial recognition is as follows: December 31, 2022 Level 1 Inputs Level 2 Inputs Level 3 Inputs Balance at Fair Value RMB RMB RMB RMB Assets Cash and cash equivalents 4,271,899 — — 4,271,899 Restricted cash 88,796 — — 88,796 Loans at fair value — — 54,049 54,049 Available-for-sale investments 48,910 888,828 35,000 972,738 Total Assets 4,409,605 888,828 89,049 5,387,482 Liabilities Payable to investors at fair value (i) — — 4,603 4,603 Total Liabilities — — 4,603 4,603 December 31, 2023 Level 1 Inputs Level 2 Inputs Level 3 Inputs Balance at Fair Value RMB RMB RMB RMB Assets Cash and cash equivalents 5,791,333 — — 5,791,333 Restricted cash 267,271 — — 267,271 Trading securities 76,053 — — 76,053 Loans at fair value — — 677,835 677,835 Available-for-sale investments 276,084 127,000 35,000 438,084 Total Assets 6,410,741 127,000 712,835 7,250,576 Liabilities Payable to investors at fair value (i) — — 447,279 447,279 Total Liabilities — — 447,279 447,279 (i): Among the payable to investors at fair value, RMB4,603 and RMB1,517 are recorded as amount due to related parties as of December 31, 2022 and 2023, respectively. As the Group’s loans and related payable to investors do not trade in an active market with readily observable prices, the Group uses discounted cash flow methodology involving significant unobservable inputs to measure the fair value of these assets and liabilities, including discount rates, net cumulative expected loss rates, and cumulative prepayment rates. Financial instruments are categorized as Level 3 valuation hierarchy based on the significance of unobservable factors in the overall fair value measurement. The Group did not transfer any assets or liabilities in or out of Level 3 during the years ended December 31, 2022 and 2023. 4. Fair Value of Assets and Liabilities — continued Significant Unobservable Inputs December 31, 2022 December 31, 2023 Range of Inputs Range of Inputs Financial Instrument Unobservable Input Weighted- Average Weighted- Average Loans at fair value Discount rates 14.0%-36.0 % 14.0%-20.0 % Net cumulative expected loss rates (i) 1.5%-12.1 % 0.5%-8.3 % Cumulative prepayment rates (ii) 10.4%-18.3 % 7.5%-18.2 % Payable to investors at fair value Discount rates 7.5%-8.6 % 7.5%-8.3 % (i) Expressed as a percentage of the loan volume. (ii) Expressed as a percentage of remaining principal of loans. The above inputs can cause significant increases or decreases in fair value. Specifically, increases in the discount rate can significantly lower the fair value of loans; conversely a decrease in the discount rate can significantly increase the fair value of loans. The discount rate is determined based on the market rates. Changes in fair value of loans and payable to investors are reported net as “Fair value adjustments gain/(loss)” in the consolidated statements of operations. The additional information about Level 3 loans and payable to investors measured at fair value on a recurring basis for the years ended December 31, 2022 and 2023 is as follows: Loans At Fair Value RMB Balance as of December 31, 2021 73,734 Origination of loans 56,147 Collection of principals (92,673) Change in fair value 16,841 Balance as of December 31, 2022 54,049 Loans At Fair Value RMB Balance as of December 31, 2022 54,049 Origination of loans 1,494,096 Collection of principals (772,398) Change in fair value (97,912) Balance as of December 31, 2023 677,835 4. Fair Value of Assets and Liabilities — continued Significant Unobservable Inputs — continued Payable to investors At Fair Value RMB Balance as of December 31, 2021 50,686 Contribution from investors of the consolidated ABFE — Interest and penalties received 11,249 Deductible expenses associated with the consolidated ABFE operation (5,216) Principal and interest payments to investors of the consolidated ABFE (92,480) Changes in fair value (2,059) Amount due to related parties (i) 37,820 Balance as of December 31, 2022 — Payable to investors At Fair Value RMB Balance as of December 31, 2022 — Contribution from investors of the consolidated ABFE 450,000 Interest and penalties received 58,481 Deductible expenses associated with the consolidated ABFE operation (5,815) Principal and interest payments to investors of the consolidated ABFE (7,770) Changes in fair value (52,220) Amount due to related parties (i) 3,086 Balance as of December 31, 2023 445,762 (i): Among the investors of the ABFE, RMB4,603 and RMB1,517 are recorded as amount due to related parties as of December 31, 2022 and 2023, respectively. Financial Instruments Not Recorded at Fair Value Financial instruments, including accounts receivable, other receivables, financing receivables, loans to third parties, prepaid expenses and other assets, held-to-maturity investments and amounts due from/to related parties, accounts payable, accrued expenses and other liabilities are not recorded at fair value. The fair values of these financial instruments are approximate their carrying value reported in the consolidated balance sheets due to the short-term nature of these assets and liabilities. |
INVESTMENTS
INVESTMENTS | 12 Months Ended |
Dec. 31, 2023 | |
INVESTMENTS | |
INVESTMENTS | 5. INVESTMENTS Trading securities As of December 31, 2023, the Group’s trading securities mainly consisted of investments in marketable debt or equity assets held by the Group with the intention of selling them in the near future to earn a profit through price fluctuations. The Group measured the trading securities at fair value in the consolidated income statement. Changes in fair value of trading securities, for the years ended December 31, 2021, 2022 and 2023 were nil, nil and RMB (4,479), respectively, recorded in the consolidated income statement. Held-to-maturity investments As of December 31, 2023, the Group’s held-to-maturity investments mainly consisted of principal-guaranteed products that have stated maturity within one year. While these fixed-income financial products are not publicly traded, the Group estimated that their fair value approximated their amortized costs considering their short-term maturities and high credit quality. No allowance for credit loss was recognized for the years ended December 31, 2021, 2022 and 2023. Interest income of held-to-maturity investments of RMB2,963, RMB1,458 and RMB21,294 was recognized in the consolidated statements of operations for the years ended December 31, 2021, 2022 and 2023, respectively. Available-for-sale investments As of December 31, 2023, the Group’s available-for-sale investments mainly consisted of investments in debt securities, bank wealth management products and non-marketable equity investments, such as private funds and non-listed companies where the Group has no significant influence over the investees’ operating and financial policies. The Group measured the available-for-sale investments at fair value, with changes in fair value deferred in other comprehensive income/(loss). Changes in fair value of available-for-sale investments, net of tax, for the years ended December 31, 2021, 2022 and 2023 were RMB(2,362), RMB(12,351) and RMB17,813, respectively, recorded in other comprehensive income/(loss). No impairment loss was recognized for the years ended December 31, 2021, 2022 and 2023. Interest income of available-for-sale investments of RMB5,238, RMB15,488 and RMB3,203 was recognized in the consolidated statements of operations for the years ended December 31, 2021, 2022 and 2023, respectively. The additional information about cost and fair value of available-for-sale investments as of December 31, 2022 and 2023 is as follows: Unrealized gains in accumulated other comprehensive Impact of December 31, 2022 Cost income exchange rate Fair value RMB RMB RMB RMB Available-for-sale investments: Bank wealth management products 888,828 — — 888,828 Debt securities 60,218 (10,154) (1,154) 48,910 Non-marketable equity investments 35,000 — — 35,000 Unrealized gains in accumulated other comprehensive Impact of December 31, 2023 Cost income exchange rate Fair value RMB RMB RMB RMB Available-for-sale investments: Bank wealth management products 127,000 — — 127,000 Debt securities 24,241 5,253 122 29,616 Non-marketable equity investments 281,410 2,406 (2,348) 281,468 |
PROPERTY, EQUIPMENT AND SOFTWAR
PROPERTY, EQUIPMENT AND SOFTWARE, NET | 12 Months Ended |
Dec. 31, 2023 | |
PROPERTY, EQUIPMENT AND SOFTWARE, NET | |
PROPERTY, EQUIPMENT AND SOFTWARE, NET | 6. PROPERTY, EQUIPMENT AND SOFTWARE, NET December 31, December 31, 2022 2023 RMB RMB Building 38,464 38,464 Computer and transmission equipment 9,183 12,106 Furniture and office equipment 460 493 Leasehold improvements 4,178 4,019 Licenses 28,490 32,990 Software 39,392 39,795 Total property, equipment and software 120,167 127,867 Accumulated depreciation and amortization 42,911 48,709 Property, equipment and software, net 77,256 79,158 Depreciation and amortization expenses on property, equipment and software for the years ended December 31, 2021, 2022 and 2023 were RMB43,236, RMB26,430 and RMB7,116, respectively. Impairment losses of long-lived assets for the years ended December 31, 2021, 2022 and 2023 were nil, nil and nil, respectively. |
ACCRUED EXPENSES AND OTHER LIAB
ACCRUED EXPENSES AND OTHER LIABILITIES | 12 Months Ended |
Dec. 31, 2023 | |
ACCRUED EXPENSES AND OTHER LIABILITIES | |
ACCRUED EXPENSES AND OTHER LIABILITIES | 7. ACCRUED EXPENSES AND OTHER LIABILITIES December 31, December 31, 2022 2023 RMB RMB Tax payable 562,839 931,191 Accrued payroll and welfare 403,104 153,554 Payable to investors (i) 147,864 145,655 Accrued advertisement expenses 58,707 134,601 Guarantee liabilities 51,766 37,153 Funds collected on behalf of third-party guarantee companies 18,766 11,387 Accrued customer incentives 5,024 3,263 Others 66,936 83,718 Total accrued expenses and other liabilities 1,315,006 1,500,522 (i) Payable to investor represents interest and principal collected by the Group on behalf of lenders. |
RELATED PARTY BALANCES AND TRAN
RELATED PARTY BALANCES AND TRANSACTIONS | 12 Months Ended |
Dec. 31, 2023 | |
RELATED PARTY BALANCES AND TRANSACTIONS | |
RELATED PARTY BALANCES AND TRANSACTIONS | 8. RELATED PARTY BALANCES AND TRANSACTIONS The Group accounts for related party transactions based on various service agreements and reflects for all periods presented herein. The major related parties and their relationships with the Group, and the nature of their services provided to the Group are summarized as follows: Relationship with the Major transaction with the Company name Group Group Pucheng Credit Assessment and Management (Beijing) Co., Ltd. (“Pucheng Credit”) Subsidiary of Consolidated VIE of CreditEase Collection services, management consulting services, customers acquisition and referral services and related party loans Puxin Subsidiary of CreditEase System support services and sales of goods Zhuoyue Consolidated VIE of CreditEase Customers acquisition and referral services and related party loans Beijing Zhicheng Credit Service Co., Ltd. (“Beijing Zhicheng”) Consolidated VIE of CreditEase Credit assessment services Zhicheng A’Fu Technology Development Co.,Ltd. (“Zhicheng A’Fu”) Consolidated VIE of CreditEase Credit assessment services Hengcheng Consolidated VIE of CreditEase (from January 2021) Post-loan management services, technical support services and acquisition and referral services China Rise Insurance Broker Limited ("Huajin") Subsidiary of Consolidated VIE of CreditEase Customers acquisition and referral services Xinda Hongtao Technology Development (Beijing) Co., Ltd. (“Xinda Hongtao”) Consolidated VIE of CreditEase Customers acquisition and referral services Goodhope Entry-Exit Consulting Services (Beijing) Company Limited. (“Goodhope”) Consolidated VIE of CreditEase Sales of goods Creditease Puze (Beijing) Fund Sales Co., Ltd. (“Creditease Puze”) Subsidiary of Consolidated VIE of CreditEase Customers acquisition and referral services Hengda Hongyuan International Technology Development (Beijing) Co., Ltd. (“Hengda Hongyuan”) Subsidiary of Consolidated VIE of CreditEase Financing services through transfer of financial lease receivables CreditEase E-Share Technology (Beijing) Limited ("Qixiang") Consolidated VIE of CreditEase Customers acquisition and referral services Chongqing Chengyuan Future E-commerce Service Co., Ltd. Consolidated VIE of CreditEase System support services Hainan CreditEase Puhui Small Loan Co., Ltd. (“Hainan CreditEase”) Subsidiary of Consolidated VIE of CreditEase Customers acquisition and referral services Ruicheng Family Information Consulting (Beijing) Co., Ltd.(“Ruicheng”) Consolidated VIE of CreditEase Customers acquisition and referral services The information about costs and expenses incurred for services provided by CreditEase, its subsidiaries and affiliates for the years ended December 31, 2021, 2022 and 2023 is as follows: Years ended December 31, 2021 2022 2023 RMB RMB RMB Customers acquisition and referral services 281,633 216,958 175,471 Credit assessment services 56,957 110,566 118,395 System support services 135,118 100,635 72,035 Collection services 17,943 22,735 29,188 Others services — 91 1,824 Total costs and expenses 491,651 450,985 396,913 The costs and expenses incurred for customers acquisition and referral service provided by Ruicheng for the years ended December 31, 2021, 2022 and 2023 amounted to nil, RMB155,093 and RMB175,824, respectively, accounting for 0%, 20% and 18% of origination, servicing and other operating costs. 8. RELATED PARTY BALANCES AND TRANSACTIONS — continued Revenue derived from services provided by the Group to CreditEase, its subsidiaries and affiliates for the years ended December 31, 2021, 2022 and 2023 is recorded as other revenue and is as follows: Years ended December 31, 2021 2022 2023 RMB RMB RMB Customers acquisition and referral service 442,570 409,688 140,782 Technical services 85,832 — — Post-loan management services 44,586 — — Others services 170 1,322 813 Total revenue 573,158 411,010 141,595 The information about loans collected from/(issued to) CreditEase, its subsidiaries and affiliates recorded in investing activities of the Company’s consolidated statements of cash flows for the years ended December 31, 2021, 2022 and 2023 is as follows: Years ended December 31, 2021 2022 2023 RMB RMB RMB Pucheng Credit — (200,000) — Total — (200,000) — The information about loans received from/(repaid to) CreditEase, its subsidiaries and affiliates recorded in financing activities of the Company's consolidated statements of cash flows for the years ended December 31, 2021, 2022 and 2023 is as follows: Years ended December 31, 2021 2022 2023 RMB RMB RMB Qichuang — (43,000) — Hengda Hongyuan (a) (26,700) (139,000) (195,800) Total (26,700) (182,000) (195,800) (a) Details of related party balances as of December 31, 2022 and 2023 are as follows: (i) December 31, December 31, 2022 2023 RMB RMB Zhuoyue (a) 549,699 310,354 Pucheng Credit (f) 204,000 203,353 Puxin (Note b) 195,406 139,071 Huichuang (a) 88,887 76,118 Hainan CreditEase (a) 20,259 26,073 Hengcheng (c) 172,103 — Others 35,878 65,212 Total 1,266,232 820,181 8. RELATED PARTY BALANCES AND TRANSACTIONS — continued (ii) December 31, December 31, 2022 2023 RMB RMB Hengda Hongyuan (e) 198,045 — Pucheng Credit (d) 12,162 9,084 Zhicheng A’Fu (d) 10,293 3,786 Others 7,224 1,544 Total 227,724 14,414 (a) (b) (c) (d) (e) (f) Non-competition arrangement The Group entered into a non-competition agreement with CreditEase, under which they agreed not to compete with each other’s core business. The non-competition agreement was amended and restated on December 31, 2020. CreditEase agreed not to compete with the Group in a business that is of the same nature as (i) the online wealth business targeting the mass affluent(which refers to individuals with RMB1million to RMB10 million investable financial assets), unsecured and secured consumer lending, financing leasing, small and medium enterprise lending and other related services and businesses (“Yiren Digital Business”), and (ii) other businesses that the Group and CreditEase may mutually agree from time to time. The Group agreed not to compete with CreditEase in the business conducted by CreditEase, other than (i) the Yiren Digital Business and (ii) other businesses that the Group and CreditEase may mutually agree from time to time. |
SECURED BORROWINGS
SECURED BORROWINGS | 12 Months Ended |
Dec. 31, 2023 | |
SECURED BORROWINGS | |
SECURED BORROWINGS | 9. SECURED BORROWINGS In 2021, 2022 and 2023, Yichuang Financial Leasing entered into several financing arrangements, with a principal amount of RMB541.6 million, nil and nil, respectively. According to the arrangements, Yichuang Financial Leasing transferred its creditor’s right or beneficial interests of certain financing receivables totaling RMB550.0 million, nil and nil with remaining lease terms ranging from 1 to 3 years originating from its finance leasing services business to external creditors. As the transfer of creditor’s right or beneficial interests of financing receivables does not constitute a true sale for transfer of assets under PRC law, the proceeds from the external creditors were considered as secured borrowings. The Group’s secured borrowings have maturities ranging from 1 to 3 years. In 2021, 2022 and 2023, the interest rate related to the secured borrowing is ranging from 7% to 11%, and the interest expenses were RMB109.8 million, RMB109.2 million and RMB39.0 million, respectively. As of December 31, 2023, the principal balance of secured borrowing is nil, among which nil secured borrowings is included in “Amounts due to related parties”. Net secured borrowings amounted to RMB767.9 million and nil as of December 31, 2022 and 2023, respectively. |
INCOME TAXES
INCOME TAXES | 12 Months Ended |
Dec. 31, 2023 | |
INCOME TAXES | |
INCOME TAXES | 10. INCOME TAXES Yiren Digital is a company incorporated in the Cayman Islands. Under the current laws of the Cayman Islands, Yiren Digital is not subject to tax on either income or capital gain. Under the current Hong Kong Inland Revenue Ordinance, YouRace HK is subject to 8.25% Profits Tax rate on assessable profits up to HK$2 million, and 16.5% on any part of assessable profits over HK$2 million. Under the PRC Enterprise Income Tax Law (the “EIT Law”), the standard enterprise income tax rate for domestic enterprises and foreign invested enterprises is 25%. YouRace Hengchuang was recognized as a Software Enterprise and thereby entitled to full exemption from EIT for two years beginning with its first profitable year, i.e., 2015 and 2016, and a 50% reduction for the subsequent three years. In November 2018, YouRace Hengchuang qualified as “high and new technology enterprise strongly supported by the State” (“HNTE”) under the EIT Law and was entitled to preferential income tax rate of 15%, and the status was reaffirmed in December 2021. Yiren Hengsheng Technology Development (Beijing) Co., Ltd. (“Yiren Hengsheng”) obtained the software enterprise certificate in March 2021, and was qualified as a Software Enterprise and thereby entitled to full exemption from EIT for two years beginning with its first profitable year, i.e., 2020 and 2021, and a 50% reduction for the subsequent three years, and the status was revaluated in May 2023. In addition, Hengyuda, Chongqing Hengfengyi Technology Co., Ltd. (“Hengfengyi”) and Chongqing Jintong Financing Guarantee Co., Ltd. (“Jintong”) have been recognized as within encouraged industries in the Western Regions of China and enjoyed a preferential income tax rate of 15%. Except for the small low-profit enterprises, whose taxable income is computed at a reduced rate of 5%, Yiren Digital’s other subsidiaries, the consolidated VIEs and the consolidated VIEs’ subsidiaries established in the PRC are subject to income tax rate of 25%, according to the EIT Law. The consolidated ABFE are not subject to income tax. Under the EIT Law and its implementation rules which became effective on January 1, 2008, dividends generated after January 1, 2008 and payable by foreign-invested enterprise in the PRC to its foreign investors who are non-resident enterprises are subject to a 10% withholding tax, unless any such foreign investor’s jurisdiction of incorporation has a tax treaty with the PRC that provides for a different withholding arrangement. Under the taxation arrangement between the PRC and Hong Kong, a qualified Hong Kong tax resident which is the “beneficial owner” and directly holds 25% or more of the equity interest in a PRC resident enterprise is entitled to a reduced withholding tax rate of 5%. The Cayman Islands, where the Company is incorporated, does not have a tax treaty with the PRC. Since January 1, 2014, the relevant tax authorities of the Group’s subsidiaries have not conducted a tax examination on the Group’s PRC entities. In accordance with relevant PRC tax administration laws, tax years from 2015 of the Group’s PRC subsidiaries and VIEs, remain subject to tax audits as of December 31, 2022, at the tax authority’s discretion. 10. INCOME TAXES — continued Income tax (benefits)/expenses are comprised of the following: December 31, December 31, December 31, 2021 2022 2023 RMB RMB RMB Current tax 85,198 410,106 512,054 Deferred tax 84,991 (109,594) 53,109 Total 170,189 300,512 565,163 Reconciliation between the income tax at the PRC statutory tax rate and income tax expenses is as follows: Years ended December 31, 2021 2022 2023 RMB RMB RMB Income before provision for income taxes 1,203,173 1,495,383 2,645,360 Statutory tax rate in the PRC 25 % 25 % 25 % Income tax expenses at statutory tax rate 300,793 373,846 661,340 Non-deductible expenses 12,663 365 — Research and development super deduction (8,508) (5,697) (11,620) Effect of income not taxable (24,604) (29,398) (58,359) Effect of tax holiday and preferential tax rate (132,485) (45,074) (108,806) Adjustment on current income tax of the prior periods (5,614) (9,085) 80 Effect of different tax rates of subsidiaries operating in other jurisdictions 28,072 5,731 26,793 Withholding income tax — — 40,000 Change in valuation allowance (128) 9,824 15,735 Income tax expenses 170,189 300,512 565,163 The aggregate amount and per share effect of the tax holiday and preferential tax rate are as follows: Years ended December 31, 2021 2022 2023 RMB RMB RMB The aggregate amount of tax holiday and preferential tax rate (132,485) (45,074) (108,806) The aggregate effect on basic and diluted net income per share: - Basic (0.7838) (0.2580) (0.6156) - Diluted (0.7766) (0.2570) (0.6089) 10. INCOME TAXES — continued Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. The components of the deferred tax assets are as follows: December 31, December 31, 2022 2023 RMB RMB Deferred tax assets: Deferred revenue 10,783 8,105 Accrued expenses and other liabilities 15,402 11,181 Fair value changes 17,556 17,350 Allowance for uncollectible receivables 113,836 121,080 Advertising expenses in excess of deduction limit — 2,068 Valuation allowance (i) (40,567) (38,545) Total 117,010 121,239 Deferred tax liabilities: Contract assets, net 105,252 162,767 Contract cost 188 10 Intangible assets 7,123 7,123 Total 112,563 169,900 Net deferred tax assets/(liabilities) 4,447 (48,661) (i) A valuation allowance is provided against deferred tax assets when the Group determines that it is more likely than not that the deferred tax assets will not be utilized in the future. In making such determination, the Group evaluates a variety of factors including the Group’s entities’ operating history, accumulated deficit, forecasts of future profitability, existence of taxable temporary differences and reversal periods. The valuation allowance is considered on an individual entity basis. The Group has recognized a valuation allowance against deferred tax assets of RMB40,567 and RMB38,545 for the years ended December 31, 2022 and 2023, respectively. The authoritative guidance requires that the Group recognizes the impact of a tax position in the financial statements if that position is more likely than not of being sustained upon audit by the tax authority, based on the technical merits of the position. Under the PRC laws and regulations, arrangements and transactions among related parties may be subject to examination by the PRC tax authorities. If the PRC tax authorities determine that the contractual arrangements among related companies do not represent a price under normal commercial terms, they may make adjustments to the companies’ income and expenses. A transfer pricing adjustment could result in additional tax liabilities. Uncertainties exist with respect to how the current income tax law in the PRC applies to the Group’s overall operations, and more specifically, with regard to tax residency status. The EIT Law includes a provision specifying that legal entities organized outside of the PRC will be considered residents for Chinese income tax purposes if the place of effective management or control is within the PRC. The implementation rules to the EIT Law provide that non-resident legal entities will be considered PRC residents if substantial and overall management and control over the manufacturing and business operations, personnel, accounting, properties, etc., occurs within the PRC. Despite the present uncertainties resulting from the limited PRC tax guidance on the issue, the Group does not believe that the legal entities organized outside of the PRC within the Group should be treated as residents for the EIT law purposes. If the PRC tax authorities subsequently determine that the Company and its subsidiaries registered outside the PRC should be deemed resident enterprises, the Company and its subsidiaries registered outside the PRC will be subject to the PRC income taxes, at a rate of 25%. The Group did not identify significant unrecognized tax benefits for the years ended December 31, 2021, 2022 and 2023. The Group did not incur any interest related to unrecognized tax benefits, did not recognize any penalties as income tax expenses and also does not anticipate any significant change in unrecognized tax benefits within 12 months from December 31, 2023. 10. INCO ME TAXES — continued Under the EIT Law and its implementation rules, a withholding tax at 10%, unless reduced by a tax treaty or arrangement, is applied on dividends received by non-PRC-resident corporate investors from the PRC-resident enterprises, such as the Company’s PRC subsidiaries. Under the China-HK Tax Arrangement and the relevant regulations, a qualified Hong Kong tax resident which is the “beneficial owner” and holds 25% equity interests or more of a PRC enterprise is entitled to a reduced withholding rate of 5%. The Company believes that YouRace HK will apply the 10% withholding tax rate. On July 29, 2017, the Board also approved a semi-annual dividend policy. Under this policy, semi-annual dividends are set at an amount equivalent to approximately 15% of the Company’s anticipated net income after tax in each half year commencing from the second half of 2017, which are derived from the earnings of the Group’s PRC companies. On August 14, 2018, the Board decided to terminate the semi-annual dividend policy going forward. Aggregate undistributed earnings of the Company’s PRC subsidiaries and the consolidated VIEs that are available for distribution were approximately RMB4,594 million and RMB3,690 million as of December 31, 2022 and 2023, respectively. A deferred tax liability should be recorded for taxable temporary differences attributable to the excess of financial reporting amounts over tax basis amount in the PRC subsidiaries and the consolidated VIEs. However, the aggregate undistributed earnings of the Company’s subsidiaries and the consolidated VIEs and its subsidiaries located in the PRC that are available for distribution as of December 31, 2023 are considered to be indefinitely reinvested and accordingly, no provision has been made for the Chinese dividend withholding taxes that would be payable upon the distribution of those amounts to any entity within the Group that is outside the PRC. |
SHARE-BASED COMPENSATION
SHARE-BASED COMPENSATION | 12 Months Ended |
Dec. 31, 2023 | |
SHARE-BASED COMPENSATION | |
SHARE-BASED COMPENSATION | 11. SHARE-BASED COMPENSATION Share incentive plan In September 2015, the Company adopted the 2015 Share Incentive Plan (the “2015 Plan”), In July 2017, the Company adopted the 2017 Share Incentive Plan (the “2017 Plan”), In June 2020, the Company adopted the 2020 Share Incentive Plan (the “2020 Plan”) which permits the grant of three types of awards: options, restricted shares and restricted share units (“RSUs”). Persons eligible to participate in the 2015 Plan, the 2017 Plan and the 2020 Plan include employees (including part-time employees) and the directors of the Company or any of affiliates, which include CreditEase, its subsidiaries and any entities in which CreditEase or a subsidiary of the Company holds a substantial ownership interest. According to the resolutions of the Board and the shareholders of the Company in July 2017, the 2015 Plan was amended. Under the amended 2015 plan, the maximum ordinary shares available for issuance were decreased to 3,939,100. Under the 2017 Plan, the maximum of 6,060,900 ordinary shares were reserved for issuance. Under the 2020 Plan, the maximum of 18,560,000 ordinary shares were reserved for issuance. Over the life of the Plan 2017, 43,386 RSUs were granted on July 1, 2019, at the fair value of US$6.92 per ordinary share, which was determined based on the closing price of the Company’s American depositary shares (“ADSs”) on The New York Stock Exchange on the grant date. Approximately 20.0% of the share awards were immediately vested with the rest to vest in various days over the next four years. Over the life of the Plan 2020, 2,592,140 RSUs were granted on June 30, 2020, at fair value of US $2.07 per ordinary share. Approximately 15.4% of the share awards were immediately vested with the rest to vest in various days over the next three years. 143,560 RSUs were granted on December 31, 2020, at fair value of US $1.67 per ordinary share, which were to vest in various days over the next three years. 1,830,024 RSUs were granted on June 30, 2021, at fair value of US$3.01 per ordinary share, which were to vest in various days over the next three years. 1,381,350 RSUs were granted on July 1, 2021, at fair value of US $2.79 per ordinary share, and all share awards were immediately vested. 168,022 RSUs were granted on January 1, 2022, at fair value of US$1.43 per ordinary share, Approximately 3.1% of the share awards were immediately vested with the rest to vest in various days over the next three years. 10,754,250 RSUs were granted on July 1, 2022, at fair value of US$0.88 per ordinary share, Approximately 79.5% of the share awards were immediately vested with the rest to vest in various days over the next three years. 479,814 RSUs were granted on January 1, 2023, at fair value of US$0.69 per ordinary share, Approximately 30.2% of the share awards were immediately vested with the rest to vest in various days over the next three years. 430,028 RSUs were granted on July 1, 2023, at fair value of US$1.14 per ordinary share, which are to vest in various days over the next three years. 11. SHARE-BASED COMPENSATION — continued Share incentive plan — continued Out of all the RSUs granted, 43,386 RSUs were granted to directors and employees of the Group under the 2017 Plan on July 1, 2019. 2,089,724 RSUs were granted under the 2020 Plan on June 30, 2020. 139,912 RSUs were granted on December 31, 2020. 1,060,464 RSUs were granted under the 2020 Plan on June 30, 2021. 447,698 RSUs were granted under the 2020 Plan on July 1, 2021. 79,732 RSUs were granted under the 2020 Plan on January 1, 2022. 3,633,302 RSUs were granted under the 2020 Plan on July 1, 2022. 192,794 RSUs were granted under the 2020 Plan on January 1, 2023. 237,554 RSUs were granted under the 2020 Plan on July 1, 2023. The awards granted to the employees of the Group are recognized as share-based compensation expenses, and measured based on the fair value as of the grant date. The Company recognized compensation expenses in general and administrative expense of RMB19,089, RMB22,135 and RMB6,752 for the years ended December 31, 2021, 2022 and 2023, respectively. The remaining 502,416 RSUs were granted to employees of CreditEase and its consolidated subsidiaries and VIEs under the 2020 Plan on June 30, 2020. 3,648 RSUs were granted under the 2020 Plan on December 31, 2020. 769,560 RSUs were granted under the 2020 Plan on June 30, 2021. 933,652 RSUs were granted under the 2020 Plan on July 1, 2021. 88,290 RSUs were granted under the 2020 Plan on January 1, 2022. 7,120,948 RSUs were granted under the 2020 Plan on July 1, 2022. 287,020 RSUs were granted under the 2020 Plan on January 1, 2023. 192,474 RSUs were granted under the 2020 Plan on July 1, 2023 The awards granted to employees of CreditEase and its consolidated subsidiaries and VIEs were recognized as deemed dividend from the Company to CreditEase as the employees of CreditEase do not provide services directly related to the Company. The awards are measured based on the fair value as of the grant date. The amount recognized as deemed dividend were RMB23,223, RMB38,168 and RMB3,698 for the years ended December 31, 2021, 2022 and 2023, respectively. The total fair value of RSUs vested for the years ended on December 31, 2021, 2022 and 2023 were RMB59,611, RMB73,068 and RMB15,476, respectively. RSUs A summary of RSUs activities is as follows: Weighted-Average Grant-Date Number of RSUs Fair Value US$ Unvested as of December 31, 2021 2,639,196 3.18 Granted 10,922,272 0.89 Vested (9,442,362) 1.15 Forfeited (915,276) 2.74 Unvested as of December 31, 2022 3,203,830 1.48 Granted 909,842 0.90 Vested (1,349,098) 1.62 Forfeited (604,826) 1.42 Unvested as of December 31, 2023 2,159,748 1.17 As of December 31, 2023, unrecognized compensation cost related to unvested awards granted to employees of the Group, adjusted for estimated forfeitures, was RMB3,554. This cost is expected to be recognized over a weighted average period of 1.1 years on an accelerated basis. As of December 31, 2023, unrecognized deemed dividend related to unvested awards granted to employees of CreditEase and its consolidated subsidiaries and VIEs, adjusted for estimated forfeitures, was RMB2,257. Such deemed dividend will be recorded over a weighted average period of 1.1 years on an accelerated basis. |
SHARE REPURCHASE PROGRAM
SHARE REPURCHASE PROGRAM | 12 Months Ended |
Dec. 31, 2023 | |
SHARE REPURCHASE PROGRAM | |
SHARE REPURCHASE PROGRAM | 12. SHARE REPURCHASE PROGRAM In June 2018, the Board authorized a share repurchase program under which the Company may repurchase up to US$20 million worth of its ADSs. In September 2022, the Board authorized a share repurchase program under which the Company may repurchase up to US$20 million worth of its ADSs. The 2018 Share Repurchase Program was simultaneously terminated. The share repurchases may be made in accordance with applicable laws and regulations through open market transactions, privately negotiated transactions or other legally permissible means as determined by the management. During the years ended December 31, 2022 and 2023, the Company had repurchased 430,260 ADSs for RMB3,837 (US$556) and 2,609,949 ADSs for RMB48,117 (US$6,777) on the open market, at a weighted average price of US$1.27 per ADS and US$2.61 per ADS, respectively. The Company accounts for the repurchased ordinary shares under the cost method and includes such treasury stock as a component of the equity. |
NET INCOME PER SHARE AND NET IN
NET INCOME PER SHARE AND NET INCOME ATTRIBUTABLE TO ORDINARY SHAREHOLDERS | 12 Months Ended |
Dec. 31, 2023 | |
NET INCOME PER SHARE AND NET INCOME ATTRIBUTABLE TO ORDINARY SHAREHOLDERS | |
NET INCOME PER SHARE AND NET INCOME ATTRIBUTABLE TO ORDINARY SHAREHOLDERS | 13. NET INCOME PER SHARE AND NET INCOME ATTRIBUTABLE TO ORDINARY SHAREHOLDERS The basic and diluted net income per share for each of the years presented are calculated as follows: Years ended December 31, 2021 2022 2023 RMB RMB RMB Numerator: Net income 1,032,984 1,194,871 2,080,197 Denominator: Weighted average number of ordinary shares outstanding, basic 169,029,826 174,695,959 176,749,706 Plus incremental weighted average ordinary shares from assumed vesting of RSUs using the treasury stock method 1,560,377 695,373 1,938,613 Weighted average number of ordinary shares outstanding, diluted 170,590,203 175,391,332 178,688,319 Basic net income per share 6.1113 6.8397 11.7692 Diluted net income per share 6.0554 6.8126 11.6415 |
LEASES
LEASES | 12 Months Ended |
Dec. 31, 2023 | |
LEASES | |
LEASES | 14. LEASES The Group leases certain office premises to support its core business under non-cancelable leases. The Group determines if an arrangement is a lease at inception. Some lease agreements contain lease and non-lease components, which the Group chooses not to account for as separate components as the Group has elected the practical expedient. As of December 31, 2023, the Group had no long-term leases that were classified as a financing lease. As of December 31, 2023, the Group had no significant lease contract that has been entered into but not yet commenced. A summary of supplemental information related to operating leases as of December 31, 2023 is as follows: Year ended Year ended December 31, 2022 December 31, 2023 Operating lease ROU assets 33,909 23,382 Operating lease liabilities 35,229 23,648 Operating leases - Weighted average remaining lease term 2.11 years 1.46 years Operating leases - Weighted average discount rate 3.3 % 3.3 % 14. LEASES — continued A summary of lease cost recognized and recorded in sales and marketing and general and administrative expenses in the consolidated statements of operations and supplemental cash information related to operating leases is as follows: Year ended Year ended December 31, 2022 December 31, 2023 Operating lease cost 27,715 19,209 Short-term lease cost 192 168 Total 27,907 19,377 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows for operating leases 17,743 20,263 Non-cash ROU assets in exchange for new lease liabilities: Operating leases 12,289 7,958 As of December 31, 2023, the maturity of operating lease liabilities under the Group’s non-cancelable operating leases is as follows: As of December 31, As of December 31, 2022 2023 RMB RMB 2023 17,945 — 2024 16,304 18,976 2025 2,253 4,445 2026 — 821 2027 and thereafter — — Subtotal 36,502 24,242 Less: imputed interest 1,273 594 Present value of operating lease liabilities 35,229 23,648 |
SEGMENT INFORMATION
SEGMENT INFORMATION | 12 Months Ended |
Dec. 31, 2023 | |
SEGMENT INFORMATION | |
SEGMENT INFORMATION | 15. SEGMENT INFORMATION The Group’s chief operating decision maker (“CODM”) has been identified as the Chief Executive Officer who reviews the consolidated results of operations when making decisions about allocating resources and assessing performance of the Group. As most of the Group’s long-lived assets are located in the PRC and most of the Group’s revenues are derived from the PRC, no geographical information is presented. In 2023, the Group adjusted the categorization of our business segments to more accurately reflect the nature of each segment’s operations. Following this adjustment, our business is organized into three segments: the financial services business, the insurance brokerage business, and the consumption and lifestyle Business and others. 15. SEGMENT INFORMATION — continued The summary of each segment’s operating results for the years ended December 31, 2021, 2022 and 2023 is as follows: Years ended December 31, 2021 2022 2023 RMB RMB RMB Net revenue: Financial services business 3,184,302 1,959,732 2,515,119 Insurance brokerage business 755,691 731,797 963,822 Consumption & lifestyle business and others 537,936 743,091 1,416,692 Total net revenue 4,477,929 3,434,620 4,895,633 Operating costs and expenses: Financial services business (2,130,221) (878,375) (1,108,663) Insurance brokerage business (556,111) (566,538) (724,652) Consumption & lifestyle business and others (406,453) (370,268) (283,948) Income from operations: Financial services business 1,054,081 1,081,357 1,406,456 Insurance brokerage business 199,580 165,259 239,170 Consumption & lifestyle business and others 131,483 372,823 1,132,744 Total segment income from operations 1,385,144 1,619,439 2,778,370 Unallocated expenses (97,811) (147,575) (183,588) Other (expenses)/income (84,160) 23,519 50,578 Income before provision for income taxes 1,203,173 1,495,383 2,645,360 Depreciation and amortization expenses of Financial services business for the years ended December 31, 2021, 2022 and 2023 were RMB29,225, RMB19,032 and RMB1,019, respectively, while such expenses of Insurance brokerage business for the years ended December 31, 2021, 2022 and 2023 were RMB94, RMB135 and RMB101, respectively, while such expenses of Consumption & lifestyle business and others for the years ended December 31, 2021, 2022 and 2023 were RMB1,308, RMB1,774 and RMB1,506, respectively. |
EMPLOYEE BENEFIT PLAN
EMPLOYEE BENEFIT PLAN | 12 Months Ended |
Dec. 31, 2023 | |
EMPLOYEE BENEFIT PLAN | |
EMPLOYEE BENEFIT PLAN | 16. EMPLOYEE BENEFIT PLAN Full time employees of the Group in the PRC participate in a government-mandated defined contribution plan pursuant to which certain pension benefits, medical care, unemployment insurance, employee housing fund and other welfare benefits are provided to employees. The Group accrues for these benefits based on certain percentages of the employees’ salaries. The total contribution for such employee benefits were RMB182,154, RMB89,682 and RMB68,192 for the years ended December 31, 2021, 2022 and 2023, respectively. |
STATUTORY RESERVES AND RESTRICT
STATUTORY RESERVES AND RESTRICTED NET ASSETS | 12 Months Ended |
Dec. 31, 2023 | |
STATUTORY RESERVES AND RESTRICTED NET ASSETS | |
STATUTORY RESERVES AND RESTRICTED NET ASSETS | 17. STATUTORY RESERVES AND RESTRICTED NET ASSETS In accordance with the PRC laws and regulations, the Company’s PRC subsidiaries, the consolidated VIEs and the consolidated VIEs’ subsidiaries are required to make appropriation to certain statutory reserves, namely general reserve, enterprise expansion reserve, and staff welfare and bonus reserve, all of which are appropriated from net profit as reported in their PRC statutory accounts. The Group’s PRC entities are required to appropriate at least 10% of their after-tax profits to the general reserve until such reserve has reached 50% of their respective registered capital. Appropriations to the enterprise expansion reserve and the staff welfare and bonus reserve are to be made at the discretion of the board of directors of each of the Group’s PRC entities. There were no appropriations to these reserves by the Group’s PRC entities for the years ended December 31, 2021, 2022 and 2023. 17. STATUTORY RESERVES AND RESTRICTED NET ASSETS — continued As a result of the PRC laws and regulations and the requirement that distributions by the PRC entity can only be paid out of distributable profits computed in accordance with the PRC GAAP, the PRC entity is restricted from transferring a portion of its net assets to the Company. Amounts restricted include paid-in capital, capital reserve and statutory reserves of the Company’s PRC entities. As of December 31, 2022 and 2023, the aggregated amounts of paid-in capital, capital reserve and statutory reserves represented the amount of net assets of the relevant entities of the Group not available for distribution amounted to RMB8,175,271 and RMB7,067,300, respectively (including the statutory reserve fund of RMB496,460 and RMB497,826 as of December 31, 2022 and 2023, respectively). |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 12 Months Ended |
Dec. 31, 2023 | |
COMMITMENTS AND CONTINGENCIES | |
COMMITMENTS AND CONTINGENCIES | 18. COMMITMENTS AND CONTINGENCIES Contingencies The Group is subject to periodic legal or administrative proceedings in the ordinary course of business. The Group does not believe that any legal or administrative proceeding to which the Group is a party will have a material effect on its business or financial condition. |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 12 Months Ended |
Dec. 31, 2023 | |
SUBSEQUENT EVENTS | |
SUBSEQUENT EVENTS | 19. SUBSEQUENT EVENTS Share Repurchase Program Under the 2022 share repurchase program, as of the date of this report, the Company had repurchased 4,037,741 ADSs for approximately US$12.1 million, including 3,607,481 ADSs for approximately US$11.5 million during the period from January 1, 2023 to the date of this report. |
SCHEDULE I - CONDENSED FINANCIA
SCHEDULE I - CONDENSED FINANCIAL INFORMATION | 12 Months Ended |
Dec. 31, 2023 | |
SCHEDULE I-CONDENSED FINANCIAL INFORMATION | |
SCHEDULE I - CONDENSED FINANCIAL INFORMATION | YIREN DIGITAL LTD. SCHEDULE I-CONDENSED BALANCE SHEETS (Amounts in thousands, except for share and per share data, or otherwise noted) December 31, December 31, December 31, 2022 2023 2023 RMB RMB US$ Assets: Cash and cash equivalents 23,974 23,160 3,262 Prepaid expenses and other assets 2,411 — — Amounts due from its subsidiaries and the consolidated VIEs 1,397,591 1,350,493 190,213 Available-for-sale investments 48,911 29,615 4,171 Investments in its subsidiaries and the consolidated VIEs 4,572,152 6,689,748 942,231 Total assets 6,045,039 8,093,016 1,139,877 Liabilities: Accrued expenses and other liabilities 14,226 7,467 1,052 Total liabilities 14,226 7,467 1,052 Equity: Ordinary shares (US$0.0001 par value; 500,000,000 shares authorized; 199,299,342 and 129 130 18 Treasury stock (2,161,574 and 7,381,472 shares as of December 31, 2022 and 2023, respectively) (46,734) (94,851) (13,359) Additional paid-in capital 5,160,783 5,171,232 728,353 Accumulated other comprehensive income 7,765 23,669 3,333 Retained earnings 908,870 2,985,369 420,480 Total equity 6,030,813 8,085,549 1,138,825 Total liabilities and equity 6,045,039 8,093,016 1,139,877 YIREN DIGITAL LTD. SCHEDULE I-CONDENSED STATEMENTS OF OPERATIONS (Amounts in thousands, except for share and per share data, or otherwise noted) Years ended December 31, 2021 2022 2023 2023 RMB RMB RMB US$ Operating expenses (39,311) (44,655) (27,675) (3,898) Interest income/(expenses) 2,399 1,833 (12,982) (1,829) Non-operating (expense)/income, net (1) (39) 1,178 166 Share of income of its subsidiaries and the consolidated VIEs 1,069,897 1,237,732 2,119,676 298,551 Net income 1,032,984 1,194,871 2,080,197 292,990 YIREN DIGITAL LTD. SCHEDULE I-CONDENSED STATEMENTS OF COMPREHENSIVE INCOME (Amounts in thousands, except for share and per share data, or otherwise noted) Years ended December 31, 2021 2022 2023 2023 RMB RMB RMB US$ Net income 1,032,984 1,194,871 2,080,197 292,990 Other comprehensive (loss)/income, net of tax of nil: Foreign currency translation adjustment (3,193) 8,563 (1,909) (269) Unrealized (loss)/gain on available-for-sale investments (2,362) (12,351) 17,813 2,509 Comprehensive income 1,027,429 1,191,083 2,096,101 295,230 YIREN DIGITAL LTD. SCHEDULE I-CONDENSED STATEMENTS OF CASH FLOWS (Amounts in thousands, except for share and per share data, or otherwise noted) Years ended December 31, 2021 2022 2023 2023 RMB RMB RMB US$ Cash Flows from Operating Activities: Net cash used in operating activities (10,040) (22,907) (25,459) (3,586) Cash Flows from Investing Activities: Amounts due from/to its subsidiaries, the consolidated VIEs and related parties (11,879) 9,766 49,654 6,993 Purchase of available-for-sale investments (34,234) — — — Proceeds on disposal of available-for-sale investments 14,942 33,215 22,682 3,195 Net cash (used in)/provided by investing activities (31,171) 42,981 72,336 10,188 Cash Flows from Financing Activities: Repurchase of ordinary shares (2,750) (3,837) (48,117) (6,777) Net cash used in financing activities (2,750) (3,837) (48,117) (6,777) Effect of foreign exchange rate changes (588) 1,273 426 60 Net (decrease)/increase in cash and cash equivalents (44,549) 17,510 (814) (115) Cash and cash equivalents, beginning of year 51,013 6,464 23,974 3,377 Cash and cash equivalents, end of year 6,464 23,974 23,160 3,262 YIREN DIGITAL LTD. SCHEDULE I-NOTES TO THE CONDENSED FINANCIAL INFORMATION 1. BASIS FOR PREPARATION The condensed financial information of the Parent Company has been prepared using the same accounting policies as set out in the Group’s consolidated financial statements, except that the Parent Company used the equity method to account for investments in its subsidiaries and the consolidated VIEs and the consolidated VIEs’ subsidiaries. Certain information and footnote disclosures normally included in the financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been condensed or omitted. The footnote disclosures contain supplemental information relating to the operations of the Group and, as such, these statements should be read in conjunction with the notes to the consolidated financial statements. 2. INVESTMENTS IN SUBSIDIARIES AND THE CONSOLIDATED VIES The Company, its subsidiaries, the consolidated VIEs and the consolidated VIEs’ subsidiaries are included in the consolidated financial statements where the inter-company balances and transactions are eliminated upon consolidation. For the purpose of the Parent Company’s stand-alone financial statements, its investments in its subsidiaries and the consolidated VIEs and the consolidated VIEs’ subsidiaries are reported using the equity method of accounting. The Parent Company’s share of income and losses of its subsidiaries and the consolidated VIEs and the consolidated VIEs’ subsidiaries are reported as shares of income/(loss) of its subsidiaries and the consolidated VIEs and the consolidated VIEs’ subsidiaries in the condensed financial information to the Parent Company. 3. AMOUNTS DUE FROM ITS SUBSIDIARIES AND THE CONSOLIDATED VIES As of December 31, 2022 and 2023, the amounts mainly represent receivables from Creditease Puhui for the disposal of subsidiaries. |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended |
Dec. 31, 2023 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Basis of presentation | Basis of presentation The consolidated financial statements of the Company have been prepared in conformity with accounting principles generally accepted in the United States of America (GAAP). |
Basis of consolidation | Basis of consolidation The consolidated financial statements include the financial statements of the Company, its wholly-owned subsidiaries, and the consolidated VIEs and the consolidated VIEs’ subsidiaries. All inter-company transactions and balances have been eliminated upon consolidation. |
VIEs | VIEs The VIE arrangements In order to comply with the PRC laws and regulations which prohibit or restrict foreign control of companies involved in provision of value-added telecommunication services and other restricted businesses, the Company operates substantially all of its business through its VIEs. The Company through its wholly owned subsidiaries (Foreign Owned Subsidiaries, the “FOS”) located in the PRC entered into a series of contractual agreements with the VIEs and their shareholders. Through the contractual agreements below, the Company has (1) the power to direct the activities that most significantly affect the economic performance of the VIEs, and (2) the right to receive the economic benefit of the VIEs that could potentially be significant to the VIEs. As a result, the shareholders of the VIEs lack the power to direct the activities of the VIEs that most significantly impact the entity’s economic performance, the obligation to absorb the expected losses, and the right to receive the expected residual returns of the entity. Accordingly, the Company is considered as the primary beneficiary of the VIEs, and the Company has consolidated the financial results of the VIEs and their subsidiaries in its consolidated financial statements. The Group’s principal VIEs that are material to the Group’s business and operations are Hexiang Insurance, Yiren Financial Information and CreditEase Puhui as of December 31, 2022 and 2023. In concluding that the Company is the primary beneficiary of the VIEs, the Company believes that the FOS’s rights under the terms of the exclusive option agreements provide it with a substantive kick out right. More specifically, the Company believes the terms of the exclusive option agreements are valid, binding and enforceable under the PRC laws and regulations currently in effect. A simple majority vote of the Company’s board of directors is required to pass a resolution to exercise the FOS’s rights under the exclusive option agreements, for which consent of the shareholders of the VIEs is not required. The FOS’s rights under the exclusive option agreements give the Company the power to control the shareholders of the VIEs and thus the power to direct the activities that most significantly impact the VIEs’ economic performance. In addition, the FOS’s rights under the powers of attorney also reinforce the Company’s abilities to direct the activities that most significantly impact the VIEs’ economic performance. The Company also believes that this ability to exercise control ensures that the VIEs will continue to execute and renew service agreements and pay service fees to the Company. The exclusive business cooperation agreements will be terminated upon the expiration of the operation term of either party if the application for renewal of its operation term is not approved by the relevant government authorities. As a result, the Company believes that it has the rights to receive substantially all of the economic benefits from the VIEs. ● VIEs — continued The VIE arrangements Power of Attorney Exclusive Option Agreements Equity Interest Pledge Agreements ● Exclusive Business Cooperation Agreements During the term of exclusive business cooperation agreements, both the FOS and the VIEs shall renew their operation terms prior to the expiration thereof so as to enable the exclusive business cooperation agreements to remain effective. The exclusive business cooperation agreements shall be terminated upon the expiration of the operation term of either the FOS or the VIEs, if the application for renewal of their operation terms is not approved by relevant government authorities. In addition, the shareholders of the VIEs have granted an irrevocable and exclusive option to the FOS to purchase any or all of the assets and businesses of the VIEs at the lowest price permitted under the PRC law. The agreements may be terminated only at the option of the FOS and the VIEs have no authority to terminate the exclusive business cooperation agreements. ● Agreements that provide the FOS with the option to purchase the equity interest in the VIEs Loan Agreements VIEs — continued The VIE arrangements Risks in relation to the VIE structure The Company believes that the contractual arrangements with the VIEs and their current shareholders are in compliance with the PRC laws and regulations and are legally enforceable. However, uncertainties in the PRC legal system could limit the Company’s ability to enforce the contractual arrangements. If the legal structure and contractual arrangements were found to be in violation of the PRC laws and regulations, the PRC government could: ● Revoke the business and operating licenses of the FOS and the VIEs; ● Discontinue or restrict the operations of any related-party transactions among the FOS and the VIEs; ● Impose fines or other requirements on the FOS and the VIEs; ● Require the Company or the FOS and the VIEs to revise the relevant ownership structure or restructure operations; ● Restrict or prohibit the Company’s use of the proceeds of the additional public offering to finance the Company’s business and operations in the PRC; ● Shut down the Company’s servers or block the Company’s online platform; ● Discontinue or place restrictions or onerous conditions on the Company’s operations; and/or ● Require the Company to undergo a costly and disruptive restructuring. The Company’s ability to conduct its business may be negatively affected if the PRC government were to carry out any of the aforementioned actions. As a result, the Company may not be able to consolidate the VIEs in its consolidated financial statements as it may lose the ability to exert effective control over the VIEs and their shareholders, and it may lose the ability to receive economic benefits from the VIEs. The interests of the shareholders of the VIEs may diverge from that of the Company and that may potentially increase the risk that they would seek to act contrary to the contractual terms, for example by influencing the VIEs not to pay the service fees when required to do so. The Company cannot assure that when conflicts of interest arise, the shareholders of the VIEs will act in the best interests of the Company or that conflicts of interests will be resolved in the Company’s favor. Currently, the Company does not have existing arrangements to address potential conflicts of interest the shareholders of the VIEs may encounter in its capacity as beneficial owners and directors of the VIEs, on the one hand, and as beneficial owners and directors of the Company, on the other hand. The Company believes the shareholders of the VIEs will not act contrary to any of the contractual arrangements and the exclusive option agreements provide the Company with a mechanism to remove the current shareholders of the VIEs should they act to the detriment of the Company. The Company relies on certain current shareholders of the VIEs to fulfill their fiduciary duties and abide by laws of the PRC and act in the best interest of the Company. If the Company cannot resolve any conflicts of interest or disputes between the Company and the shareholders of the VIEs, the Company would have to rely on legal proceedings, which could result in disruption of its business, and there is substantial uncertainty as to the outcome of any such legal proceedings. VIEs — continued Risks in relation to the VIE structure The following financial statement amounts and balances of the consolidated VIEs and the consolidated VIEs’ subsidiaries were included in the consolidated financial statements after elimination of intercompany transactions and balances: December 31, December 31, 2022 2023 RMB RMB Assets Cash and cash equivalents 2,795,805 3,362,736 Trading securities — 76,053 Accounts receivable 100,756 56,735 Contract assets, net 107,679 154,384 Contract cost 652 3 Prepaid expenses and other assets 114,310 45,781 Financing receivables 514,388 113,951 Amounts due from related parties 911,432 447,891 Available-for-sale investments 600,000 — Property, equipment and software, net 62,979 61,735 Deferred tax assets 84,096 73,338 Right-of-use assets 10,474 10,659 Total assets 5,302,571 4,403,266 Liabilities Accounts payable 9,196 18,211 Amounts due to related parties 214,346 6,586 Deferred revenue 9,488 15 Accrued expenses and other liabilities 1,131,504 1,243,490 Secured borrowing 767,900 — Deferred tax liabilities 17,273 20,019 Lease liabilities 9,311 9,749 Total liabilities 2,159,018 1,298,070 Years ended December 31, 2021 2022 2023 RMB RMB RMB Net revenue 3,192,329 1,821,561 1,623,596 Net income 752,164 424,834 351,373 Years ended December 31, 2021 2022 2023 RMB RMB RMB Net cash (used in)/provided by operating activities (236,406) 1,151,656 1,013,875 Net cash (used in)/provided by investing activities (393,659) 417,535 906,485 Net cash provided by/(used in) financing activities 501,400 (399,700) (963,700) VIEs — continued Risks in relation to the VIE structure In accordance with the VIE contractual arrangements, the FOS have the power to direct activities of the VIEs, and can have assets transferred out of the VIEs. There are no consolidated VIEs’ assets that are collateral for the VIEs’ obligations and can only be used to settle the VIEs’ obligations. There are no creditors (or beneficial interest holders) of the VIEs that have recourse to the general credit of the Company. There are no terms in any arrangements, considering both explicit arrangements and implicit variable interests, which require the Company or its subsidiaries to provide financial support to the VIEs. However, if the VIEs ever need financial support, the Company or its subsidiaries may, at its option and subject to statutory limits and restrictions, provide financial support to its VIEs through loans to the shareholders of the VIEs or entrustment loans to the VIEs. Relevant PRC laws and regulations restrict the VIEs from transferring a portion of their net assets, equivalent to the balance of their paid-in capital, capital reserve and statutory reserves, to the Company in the form of loans and advances or cash dividends. Please refer to Note 17 for disclosure of restricted net assets. |
Consolidated ABFE | Consolidated ABFE As part of the Group’s strategy to expand its investor base from individual investors to institutional investors, the Group established a business relationship with certain trusts or Asset Backed Special Plan (“ABS plan”), collectively referred to as consolidated assets backed financing entities or ABFE, which were administered by third-party trust companies. The ABFE were set up to invest solely in the loans facilitated by the Group on its platform to provide returns to the beneficiaries of the trusts through interest payments made by the borrowers. The Group provides loan facilitation and post-origination services to the ABFE. The Group also has power to direct the activities that have most significant impact on the economic performance of the ABFE by providing the loan servicing and default loan collection services of the ABFE. Through the transaction fees charged, guarantee deposit, and direct investment, the Group has the right to receive benefits or bear losses from the ABFE that could potentially be significant to the ABFE. The Group holds significant variable interest in the ABFE through the transaction fees charged, guarantee provided in the form of guarantee deposit, or direct investment. Accordingly, the Company is considered the primary beneficiary of the ABFE and has consolidated the ABFE’s assets, liabilities, results of operations, and cash flows in the consolidated financial statements. The assets of the ABFE are not available to creditors of the Company. In addition, the investors of the ABFE have no recourse against the assets of the Company. Consolidated ABFE — continued The following financial statement amounts and balances of the consolidated ABFE were included in the consolidated financial statements after elimination of intercompany transactions and balances: December 31, December 31, 2022 2023 RMB RMB Assets Restricted cash 88,796 267,271 Prepaid expenses and other assets 532 5,942 Loans at fair value 54,049 288,764 Held-to-maturity investments 2,300 10,420 Total assets 145,677 572,397 Liabilities Accounts payable 150 1,023 Amount due to related party 4,603 1,517 Payable to investors at fair value — 445,762 Accrued expenses and other liabilities 72 2,142 Total liabilities 4,825 450,444 Years ended December 31, 2021 2022 2023 RMB RMB RMB Net (loss)/income (38,720) 17,949 (68,024) Years ended December 31, 2021 2022 2023 RMB RMB RMB Net cash provided by/(used in) operating activities 17,016 (1,434) 211,185 Net cash provided by/(used in) investing activities 65,576 34,976 (900,142) Net cash (used in)/provided by financing activities (71,204) (85,587) 818,305 All assets of the consolidated ABFE are collateral for the consolidated ABFE’s obligations and can only be used to settle the consolidated ABFE’s obligations. |
Use of estimates | Use of estimates The preparation of the financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from such estimates. Significant accounting estimates are used for, but not limited to, revenue recognition and its related accounts, allowance for accounts receivable and contract assets, allowance for financing receivable, guarantee liabilities, fair value measurement of loans at fair value, payable to investors at fair value, available-for-sale investments, depreciable lives of property, equipment and software, the discount rate for leases, consolidation of the VIEs, share-based compensation and income tax. Actual results may differ materially from those estimates. |
Revenue | Revenue The majority of the Group’s revenue for the years ended December 31, 2021, 2022 and 2023 were generated from the PRC. The following table illustrates the disaggregation of revenue in 2021, 2022 and 2023 under Accounting Standards Codification (“ASC”) 606, “Revenue from Contracts with Customers”. 2021 2022 2023 RMB RMB RMB Financial services business: Loan facilitation services 2,105,776 1,362,685 2,240,852 Post origination services 174,255 204,336 17,203 Financing services 524,840 278,783 55,975 Others 379,431 113,928 201,089 Subtotal 3,184,302 1,959,732 2,515,119 Insurance brokerage business: Insurance brokerage services 755,691 731,797 963,822 Subtotal 755,691 731,797 963,822 Consumption & lifestyle business and others: Electronic commerce services 33,114 302,896 1,267,104 Others 504,822 440,195 149,588 Subtotal 537,936 743,091 1,416,692 Total net revenue 4,477,929 3,434,620 4,895,633 (a) Financial services business: Revenue from loan facilitation and post-origination services The Group provides services as an online marketplace connecting borrowers and investors. The investors used to consist of individual investors and institutional investors. In 2020, the Group ceased to facilitate new loans funded by individual investors. The Group provides loan facilitation services, guarantee services and post-origination services (e.g. cash processing, collection for some lenders and SMS services). The Group has determined that it is not the investor or borrower in the loan origination and repayment process, but acts as an agent to bring the investor and the borrower together. Except for loans and payable to investors in the consolidated ABFE, loans and lease receivables arising from direct financing leases issued by the Group, the Group does not record the loans receivable or payable arising from the loans facilitated between the investors and borrowers on its platform. Previously, transaction fees were charged from borrowers directly through either upfront charges, monthly payments, or a combination of both methods. After stopping the facilitation of new loans funded by individual investors, the Group only collects transaction fees (including loan facilitation service fees and post-origination service fees) from third party funding partners, and guarantee companies, if any, on pre-agreed schedules. The Group also receives service fees contingent on future events (e.g., penalty fees for loan prepayment and late payment). Revenue — continued Revenue from loan facilitation and post-origination services— continued The Group determines its customers to be both the investors and borrowers. The Group assesses ability and intention to pay the service fees of both borrowers and investors when they become due and determines if the collection of the service fees is probable, based on historical experiences as well as the credit due diligence performed on each borrower prior to loan origination. While the post-origination services are within the scope of ASC 860, ASC 606 revenue recognition model is applied due to the lack of definitive guidance in ASC 860. The loan facilitation services and post-origination services are two separate performance obligations under ASC 606, as these two deliverables are distinct in that customers can benefit from each service on its own and the Group’s promises to deliver the services are separately identifiable from each other in the contract. The Group determines the transaction price of loan facilitation services and post-origination services to be the service fees chargeable from the borrowers, net of value-added tax. The transaction price includes variable consideration in the form of prepayment risk of the borrowers. The Group reflects, in the transaction price, the borrower prepayment risk and estimates variable consideration for these contracts using the expected value approach on the basis of historical information and current trends of the prepayment percentage of the borrowers. The transaction price is allocated amongst the guarantee services, if any, and the two performance obligations described above. The Group first allocates the transaction price to the guarantee liabilities, if any, in accordance with ASC 460, Guarantees, which requires the guarantee to be measured initially at fair value based on the stand ready obligation. The remaining considerations are then allocated to the loan facilitation services and post-origination services using their relative standalone selling prices consistent with the guidance in ASC 606. The Group does not have observable standalone selling price information for the loan facilitation services or post-origination services because it does not provide loan facilitation services or post-origination services on a standalone basis. There is no direct observable standalone selling price for similar services in the market that is reasonably available to the Group. As a result, the estimation of standalone selling price involves significant judgments. The Group uses expected cost plus margin approach to estimate the standalone selling prices of loan facilitation services as the basis of revenue allocation. In estimating its standalone selling price for the loan facilitation services, the Group considers the cost incurred to deliver such services, profit margin for similar arrangements, customer demand, effect of competitors on the Group’s services, and other market factors. However, for post-origination services, given the main services are about loan collecting and cash processing, the Group can refer to other companies performing the same services, therefore a direct observable standalone selling price for similar services in the market is available to the Group. For each type of the services, the Group recognizes revenue when (or as) the entity satisfies the service/performance obligation by transferring a promised service to a customer. Revenues from loan facilitation are recognized at the time a loan is originated between the investor and the borrower and the loan principal is transferred to the borrower, at which time the facilitation service is considered completed. Revenues from post-origination services are recognized on a straight-line basis over the term of the underlying loans as the services are provided. Revenues from guarantee services, if any, are recognized amortized during the guarantee term. Remaining performance obligations represents the amount of the transaction price for which services have not been performed under post-origination services. The Group collects service fees monthly, and used to collect upfront or both. For upfront fees that are partially refundable to the borrowers, the Group estimates the refund based on historical prepayment probability and the corresponding predetermined refundable amount, and records corresponding refund liabilities upon receiving such fees. The aggregate amounts of the transaction price allocated to performance obligations that are unsatisfied pertaining to post-origination services were RMB12.5 million and RMB3.6 million as of December 31, 2022 and 2023, respectively, among which approximately 99% and 100% of the remaining performance obligations will be recognized over the following 12 months, respectively and with the remainder recognized thereafter. Revenue — continued Other revenue of financial services business Other revenue of financial service business includes referral service fees, penalty fees for loan prepayment and late payment and other service fees, such as technical service provided to the Disposed Business, guarantee services and value - added services for auto - secured loans. The Group refers potential borrowers to third-party companies and related parties and charges them fixed rate on certain basis (principal amount, click amount and etc.).Referral services revenue is recognized when successful referrals were completed by the Group. The penalty fees is based on a certain percentage of past due amounts in case of late payment or a certain percentage of the contract amounts in case of prepayment and the Group recognizes the relevant revenue when the fees are received. The Group provide system maintenance service to the Disposed Business and the technical service revenue is recognized over the contract term. Guarantee service fees are released from guarantee liability on a straight - line basis over the term of the guarantee. The Group also provide value - added services for auto - secured loans, mainly including GPS installation service. The revenue was recognized after the completion of the installation services. (b) Insurance brokerage business: Revenue from insurance brokerage services The Group provides insurance brokerage services selling various health and life insurance products and property and casualty insurance products on behalf of insurance companies. As an agent of the insurance companies, the Group sells insurance policies on behalf of the insurance companies and earns brokerage commissions determined as a percentage of premiums paid by the insured, including premiums paid upon renewals. The Group has identified its promise to sell insurance policies on behalf of the insurance companies as the performance obligation in its contracts with the insurance companies. The Group’s performance obligation to the insurance company is satisfied and commission revenue, including renewal commission revenue, is recognized at the point in time when an insurance policy becomes effective. The renewal commission revenue is recognized based on the projected renewal rate. The following table provides the amount of the disaggregation of revenue in 2021 2022 and 2023: 2021 2022 2023 RMB RMB RMB Insurance brokerage services: Life and health insurance business 515,436 420,273 551,809 Property & casualty insurance business 240,255 311,524 412,013 Total 755,691 731,797 963,822 The terms for health and life insurance products sold by the Group vary and are typically five The Group determines the transaction price of its contracts by estimating commissions that the entity expects to be entitled to over the premium collection term of the policy based on assumption about future customer behavior and market conditions. The Group makes estimates for the renewal rate based on the historical experience, reasonable and supportable forecasts of policyholders’ behavior, current economic conditions, and other contributing factors. Such estimates are ‘constrained’ in accordance with ASC 606. That is, the Group uses the expected value method and only includes estimated amounts in the transaction price to the extent it is probable that a significant reversal of cumulative revenue recognized for such transactions will not occur. Revenue — continued (c) Consumption & lifestyle business and others: Revenue from electronic commerce services The Group evaluates whether it is appropriate to record the gross amount of product sales and related costs or the net amount earned as commissions. When the Group is a principal, its performance obligation is to transfer promised goods or services to customers. For arrangements where the Group controls the goods or services before they are transferred to the customers as a principal, as it is primarily responsible for fulfilling the promise to provide the goods or services, is subject to inventory risk, and has discretion in establishing prices, revenue is recorded on a gross basis. As the goods or services generally sold with a right of return, the sales revenue is recognized when the products are delivered and not returned within the 7-day When the Group is an agent, its performance obligation is to facilitate third-party merchants in fulfilling their performance obligation for specified goods or services. Upon successful sales, the Group charges the third-party merchants a fixed rate commission based on the sales amount. The revenue is recognized on a net basis at the point of 7 days after delivery of products. The Group also provides a variety of non-physical products to fulfill our customers’ diverse consumption demands in different life scenarios, including upgraded membership services with more flexible pricing and enriched offerings, such as popular video streaming platform accounts and healthcare products and services. Revenues generated by the Group from these businesses are recorded under “e-commerce service income” when the performance obligation is satisfied. For the annual and quarter membership cards, the receipt of premium membership fees is initially recorded as “Deferred Revenue” and membership fees are recognized ratably over the terms of the membership cards as the Group’s performance obligation is satisfied over time under “e-commerce service income.” In 2022 and 2023, the revenue generated from the Group’s operations as a principal accounted for 99.1% and 99.7% of total e - commerce revenue, respectively. As of December 31, 2022 and 2023, the inventory balance related to e - commerce revenue were immaterial. Other revenue of other business Other revenue of other Contract assets Under ASC 606, contract assets represent the Group’s rights to consideration in exchange for services that the Group has transferred to the customer before payment is due. For the financial service business, the Group’s rights to consideration for the monthly fees related to facilitation services are conditional on the borrowers’ actual payment, as the borrowers have the rights to early terminate the loan contracts prior to the loan maturity and are not obligated to pay the remaining monthly fees. As such, the Group records a corresponding contract assets for the monthly service fees allocated to loan facilitation services and post-origination services that have already been delivered in relation to loans facilitated on the Group’s platform when recognizing revenue from loan facilitation services and post-origination services. For insurance brokerage services, contract assets are recorded for arrangements when the Group has provided the services but for which the related payments are not yet due. Contract assets are attributable to the brokerage commission that is contingent upon the future premium payment of the policy holders. Revenue — continued Contract assets — continued The facilitation service monthly fee that are past the payment due date but have not been paid are reclassified to accounts receivable. The Group only recognizes contract assets to the extent that the Group believes it is probable that it will collect substantially all of the consideration to which it will be entitled in exchange for the services transferred to the customer. The contract assets, net of allowance are RMB626,739 and RMB978,051 as of December 31, 2022 and 2023, respectively. Per ASC 606-10-45-3, an entity shall assess a contract asset for impairment in accordance with Topic 310 on receivables. Contract assets are stated at the historical carrying amount net of write offs and allowance for uncollectible accounts. In determining whether an impairment loss should be recorded in the financial statements, the Group makes judgements as to whether there is any observable data indicating that there is a measurable decrease in the estimated future cash flows from contract assets. This evidence may include observable data indicating that there has been an adverse change in the borrower’s credit risk, or national or local economic conditions that correlate with defaults on loans. When contract assets are assessed for impairment, the Group uses estimates based on the historical borrower’s credit risk. The historical borrower’s credit risk is adjusted on the basis of the relevant observable data that reflects current economic conditions. The Group regularly reviews the methodology and assumptions used for estimating the amount of collectable contract assets. Contract assets are identified as uncollectible if any repayment of the underlying loan is 90 days past due, and no other factor evidences the possibility of collecting the delinquent amounts. The Group will write off contract assets and corresponding allowance if any repayment of the underlying loan is 90 days past due. Contract assets as of December 31, 2022 and 2023 are as follows: As of December 31, 2022 As of December 31, 2023 RMB RMB Contract assets 780,174 1,142,192 Allowance (153,435) (164,141) Contract assets, net 626,739 978,051 The following table presents the movement of allowance for contract assets for the years ended December 31, 2022 and 2023: Year ended December 31, 2022 Year ended December 31, 2023 RMB RMB Balance at beginning of the year 350,686 153,435 Allowance for contract assets 110,888 196,426 Write-off (308,139) (185,720) Balance at end of the year 153,435 164,141 Contract cost The Group pays commissions for successful referring of borrowers to the Group. The commissions paid based on successful referrals are considered as contract acquisition cost, and are capitalized when the commission becomes payable. The amount of amortization for the years ended December 31, 2022 and 2023 are RMB17.8 million and RMB0.7 million, respectively. Amortization of the capitalized contract cost is charged to the consolidated statements of operations when the revenue to which the asset relates is recognized. Contract cost is recognized as an expense when incurred if the amortization period of the asset that the Group otherwise would have recognized is one year or less. The Group recorded nil impairment loss for contract cost as of December 31, 2022 and 2023, respectively. Revenue — continued Deferred revenue Deferred revenue consists of the premium membership fees for annual and quarter membership cards received from clients and post-origination service fees received upfront from borrowers which services have not yet been provided. Deferred revenue is recognized ratably as revenue when the related services are provided over the service period. The amounts of revenue recognized during the years ended December 31, 2022 and 2023 that were included in the opening deferred revenue were RMB2.1 million and RMB65.5 million, respectively. |
Guarantee liabilities | Guarantee liabilities The Group provided guarantee services in connection with some of the loans facilitated to its institutional funding partners, who are entitled to receive unpaid interest and principal as contracted from the Group. According to ASC 326, Financial Instruments—Credit Losses, at inception of the guarantee, the Group recognizes both a stand-ready guarantee liability under ASC 460 with an associated guarantee receivable, and a contingent guarantee liability with an allowance for credit losses under Current expected credit loss (“CECL”) model. Subsequent to the initial recognition, the ASC 460 stand-ready guarantee is released into guarantee revenue on a straight-line basis over the term of the guarantee, while the contingent guarantee is reduced by the payouts made by the Group to compensate the funding partners upon borrowers’ default. |
Fair value | Fair value Fair value is the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. When determining the fair value measurements for assets and liabilities required or permitted to be recorded at fair value, the Group considers the principal or most advantageous market in which it would transact and it considers assumptions that market participants would use when pricing the asset or liability. Authoritative literature provides a fair value hierarchy, which prioritizes the inputs to valuation techniques used to measure fair value into three broad levels. The level in the hierarchy within which the fair value measurement in its entirety falls is based upon the lowest level of input that is significant to the fair value measurement as follows: ● Level 1-inputs are based upon unadjusted quoted prices for identical assets or liabilities traded in active markets. ● Level 2-inputs are based upon quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets and liabilities in markets that are not active and model-based valuation techniques for which all significant assumptions are observable in the market or can be corroborated by observable market data for substantially the full term of the assets or liabilities. ● Level 3-inputs are generally unobservable and typically reflect management’s estimates of assumptions that market participants would use in pricing the asset or liability. The fair value are therefore determined using model-based techniques that include option pricing models, discounted cash flow models, and similar techniques. 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES — continued Fair value option The Group has elected the fair value option for the assets and liabilities of the consolidated ABFE that otherwise would not have been carried at fair value. Such election is irrevocable and is applied to financial instruments on an individual basis at initial recognition. See Note 4 for the disclosure on financial instruments of the consolidated ABFE for which the fair value option has been elected. Fair value of loans and payable to investors at fair value The Group has elected the fair value option for loans and related payable to investors of the consolidated ABFE and loans repurchased from the consolidated ABFE that otherwise would not have been carried at fair value. Such election is irrevocable and is applied to financial instruments on an individual basis at initial recognition. The Group estimates the fair value of loans and payable using a discounted cash flow valuation methodology by discounting the estimated future net cash flows using an appropriate discount rate. The future net cash flows are estimated based on the contractual cash flows, taking into consideration of projected prepayments and net charge off to project future losses and net cash flows on loans. Changes in fair value of loans and payable to investors are reported net and recorded in “Fair value adjustments gain/(loss)” in the consolidated statements of operations. |
Cash and cash equivalents | Cash and cash equivalents Cash and cash equivalents include the Group’s unrestricted deposits with financial institutions in checking, money market and short-term certificate of deposit accounts. The Group considers all highly liquid investments with stated maturity dates of three months or less from the date of purchase to be cash equivalents. |
Restricted cash | Restricted cash Restricted cash represents cash held by the consolidated ABFE through segregated bank accounts which is not available to fund the general liquidity needs of the Group and guarantee deposit in restricted bank account. |
Accounts receivable and allowance for uncollectible accounts | Accounts receivable and allowance for uncollectible accounts Accounts receivable are stated at the historical carrying amount net of write-offs and allowance for uncollectible accounts. The Group establishes an allowance for uncollectible accounts receivable and other receivables based on estimates, historical experience and other factors surrounding the credit risk of specific customers. Uncollectible receivables are written off when a settlement is reached for an amount that is less than the outstanding historical balance or when the Group has determined the balance will not be collected. The Group recorded RMB18,235 and RMB46,715 allowance for accounts receivable as of December 31, 2022 and 2023, respectively. |
Financing receivables | Financing receivables Financing receivables represent loans and lease receivables arising from direct financing leases issued by the Group. Financing receivables are measured at amortized cost and reported on the consolidated balance sheets based on the outstanding principal adjusted for any write-off, accrued interest receivable adjusted for any write-off, and the allowance for credit losses. Amortized cost of a financing receivables is equal to the unpaid principal balance, plus net deferred origination cost if any. The Group recognizes interest and financial service income over the terms of the financing receivables using the effective interest rate method. Balances are considered past due if borrowers do not make the monthly payment by the end of the monthly billing period. The Group’s financing receivables consist of predominantly financial leasing loans extended to automobiles purchasers. As the financing receivables are collateral with autoes and generally have similar risk characteristics, the Group monitors the credit quality of the financing receivables as a single portfolio. The allowance for financing receivables including principal and accrued interest receivables is calculated based on estimated default rate of loans financed. The average loan period for loans originated in 2021, 2022 and 2023 were 26.2 months, 27.0 months and nil Loan receivables are placed on non-accrual status if such loans are past due for more than 90 days. Loan principal and accrued interest receivable will be written-off if the Group make exemption to borrowers or when management determines the balance is uncollectible and the Group ceases the collection efforts if the loans are overdue more than 3 years. If the previously written-off amounts are subsequently collected, the Group will recognize interest income based on actual collections. As the financing receivables generally have similar risk characteristics, the Group’s key credit quality indicator is the aging (days past due status) of its financing receivables balances. Financing receivables shall be classified as Concern, Secondary, Suspicious and Loss, if the loans are overdue for 90 days, 91 to 270 days, 271 to 360 days, or more than 360 days, respectively. 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES — continued Financing receivables — continued The gross finance receivables by credit quality indicator buckets on a contractual basis and year of origination consisted of the following: Year of loan origination Category As of December 31, 2022 As of December 31, 2023 RMB RMB 2019 Normal — — Concern — — Secondary — — Suspicious — — Loss 1,671 1,658 2020 Normal 80,757 — Concern 6,966 155 Secondary 18,917 1,119 Suspicious 877 1,331 Loss 1,826 18,250 2021 Normal 276,487 33,351 Concern 22,096 1,656 Secondary 49,288 5,465 Suspicious 36,368 5,544 Loss 8,045 89,104 2022 Normal 51,825 6 Concern — — Secondary — 68 Suspicious — — Loss — — 2023 Normal — 2,416 Concern — 3,221 Secondary — 3,428 Suspicious — 1,249 Loss — 1 Total 555,123 168,022 The Group’s financing receivables as of December 31, 2022 and 2023 are as follows: As of December 31, 2022 As of December 31, 2023 RMB RMB Financing receivables 555,123 168,022 Allowance (40,735) (51,858) Financing receivables, net 514,388 116,164 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES — continued Financing receivables — continued As of December 31, 2022 and 2023, the accrued interest receivables were RMB53.1 million and RMB3.5 million (net of allowance RMB2.1 million and RMB1.2 million, respectively), which is recorded under financing receivables. The movement of allowance for financing receivables for the years ended December 31, 2022 and 2023 is as follows: Year ended December 31, 2022 Year ended December 31, 2023 RMB RMB Balance at beginning of the year 65,489 40,735 Current year net provision 38,625 32,833 Write-off (14,605) (21,710) Disposal (48,774) — Balance at end of the year 40,735 51,858 The Group extended loans with automobiles as collaterals and transferred its financing receivables to other assets management companies (Note 9), the allowance of disposed financing receivables were 48.8 million and nil for the years ended December 31, 2022 and 2023, respectively. The Group has provided financing that are secured by pledged assets, which value is in excess of the financing granted to clients. As of December 31, 2023, the loan term of the majority of financing receivables are over 24 months. The Group has not recorded any financing income on an accrual basis for the loans that are overdue for more than 90 days in 2023. Allowance of financing receivables were RMB35.3 million, RMB38.6 million and RMB32.8 million for the years ended December 31, 2021, 2022 and 2023, respectively. As of December 31, 2022 and 2023, the balance of overdue loans are RMB146.1 million and RMB132.2 million, respectively, among which RMB117.0 million and RMB127.2 million are overdue for more than 90 days. |
Investments | Investments The Group’s investments consist of trading securities, held-to-maturity investments and available-for-sale investments. Trading securities Trading securities refer to financial assets that the Group purchases and holds primarily for the purpose of profiting from short - term price fluctuations. These securities include stocks, bonds, and other financial instruments that are readily marketable. All gains and losses generated, including both realized and unrealized, are recorded in the consolidated income statement. Held-to-maturity investments Investments are classified as held-to-maturity when the Group has the positive intent and ability to hold the security to maturity, and are recorded at amortized cost. The Group reviews its investments in held-to-maturity investments for impairment periodically, recognizing an allowance, if any, by applying an estimated loss rate. The Group considers available quantitative and qualitative evidence in evaluating the potential impairment of its investments in held-to-maturity investments. The allowance for credit losses is a valuation account that is deducted from the amortized cost basis of the financial assets to present the net carrying value at the amount expected to be collected on the held-to-maturity investments. 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES — continued Investments — continued Available-for-sale investments Investments that do not meet the criteria of held-to-maturity or trading securities are classified as available-for-sale, and are reported at fair value with unrealized gains and losses recorded in the consolidated statements of comprehensive income/(loss). Realized gains or losses are included in the consolidated statements of operations during the period in which the gains or losses are realized. The Group evaluates each individual investment periodically for impairment. For investments where the Group does not intend to sell, the Company evaluates whether a decline in fair value is due to deterioration in credit risk. Credit-related impairment losses, not to exceed the amount that fair value is less than the amortized cost basis, are recognized through an allowance for credit losses on the consolidated balance sheet with corresponding adjustment in the consolidated statements of operations and comprehensive income. Subsequent increases in fair value due to credit improvement are recognized through reversal of the credit loss and corresponding reduction in the allowance for credit loss. Any decline in fair value that is non-credit related is recorded in accumulated other comprehensive income as a component of shareholder’s equity. As of December 31, 2023, there were no investments held by the Group that had been in continuous unrealized loss position. |
Asset Acquisition | Asset Acquisition If the transaction involves the acquisition of an asset or group of assets that does not meet the definition of a business, it is accounted for as an asset acquisition. An asset acquisition is recorded at cost, which includes capitalized transaction costs, and does not result in the recognition of goodwill. The cost of the acquisition is allocated to the assets acquired on the basis of relative fair values. In July 2023, the Group acquired Chongqing Jintong Financing Guarantee Co., Ltd., a licensed financing guarantee company in China for a total consideration of RMB204.9 million. The Group considered it an asset acquisition as substantially all of the fair value of the gross assets acquired was concentrated in the license as a single identifiable asset. |
Property, equipment and software, net | Property, equipment and software, net Property, equipment and software consists of building, computer and transmission equipment, furniture and office equipment, software, licenses, and leasehold improvements, which are recorded at cost less accumulated depreciation and amortization. Depreciation and amortization are calculated on a straight-line basis over the following estimated useful lives, while the estimate residual value of the building and furniture and office equipment are Building 20 years Computer and transmission equipment 3 years Furniture and office equipment 5 years Software 1 5 Licenses Indefinite-lived Leasehold improvements Over the shorter of the lease term or expected useful lives |
Impairment of long-lived assets | Impairment of long-lived assets The Group reviews its long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may no longer be recoverable. When these events occur, the Group measures impairment by comparing the carrying value of the long-lived assets to the estimated undiscounted future cash flows expected to result from the use of the assets and their eventual disposition. If the sum of the expected undiscounted cash flow is less than the carrying amount of the assets, the Group recognizes an impairment loss based on the fair value of the assets. |
Origination, servicing and other operating costs | Origination, servicing and other operating costs Origination and servicing expenses consist primarily of variable expenses and vendor costs, including costs related to credit assessment, customer and system support, payment processing services and collection associated with facilitating and servicing loans. It also consists of costs in connection with the distribution of insurance products, including payroll and related expenses for insurance agents and transaction fee charged by third-party payment platform. In addition, it includes cost of goods for e-commerce business. |
Leases | Leases The Group categorizes leases with contractual terms longer than twelve months as either operating or finance lease. The Group has no finance leases for any of the periods presented. Right-of-use (“ROU”) assets represent the Group’s rights to use underlying assets for the lease term and lease liabilities represent the Group’s obligation to make lease payments arising from the lease. ROU assets and lease liabilities are recognized at commencement date based on the present value of lease payments over the lease term, reduced by lease incentives received, plus any initial direct costs, using the discount rate for the lease at the commencement date. As the implicit rate in lease is not readily determinable for the Group’s operating leases, the Group uses the incremental borrowing rate based on the estimated rate of interest for collateralized borrowing over a similar term of the lease payments at commencement date. Lease expenses for lease payments are recognized on a straight-line basis over the lease term. The Group estimates its incremental borrowing rate based on an analysis of publicly traded debt securities of companies with credit and financial profiles similar to its own. The Group begins recognizing lease expenses when the lessor makes the underlying assets available to the Group. The Group’s leases have remaining lease terms of up to three years, some of which include options to extend The Company elected not to record a ROU assets for short-term leases that have a term of less than 12 months. The cost of short-term leases was recognized in the consolidated statements of operations on a straight-line basis over the lease term. |
Share-based compensation | Share-based compensation All share-based awards to employees and directors, such as stock options and restricted share units, are measured at the grant date based on the fair value of the awards. Share-based compensation, net of forfeitures, is recognized as expenses on an accelerated basis during the vesting period with a corresponding impact reflected in the additional paid-in capital. Share-based compensation expenses are classified in the consolidated statements of operations based upon the job functions of the grantees. Forfeitures are estimated at the time of grant and revised in subsequent periods if actual forfeitures differ, or are expected to differ, from those estimates. Changes in estimated forfeiture rate are recognized through a cumulative catch-up adjustment in the period of change and also impact the amount of share-based compensation expenses to be recognized in future periods. The Group uses historical data to estimate pre-vesting option and records share-based compensation expenses only for those awards that are expected to vest. According to Issue 21 of EITF Issue 00-23 1 Share-based awards to non-employees are measured based on the fair value at grant date. The Group recognizes the compensation cost using the graded vesting attribution method. |
Income taxes | Income taxes Current income taxes are provided for in accordance with the laws of the relevant tax authorities. Deferred income taxes are provided using assets and liabilities method, which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the consolidated financial statements. Under this method, deferred tax assets and liabilities are determined on the basis of the differences between the financial statements and the tax basis of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to be reversed. Deferred tax assets are recognized to the extent that these assets are more likely than not to be realized. In making such a determination, the management considers all positive and negative evidence, including future reversals of projected future taxable income and results of recent operation. The impact of an uncertain income tax position on the income tax return is recognized at the largest amount that is more likely than not to be sustained upon audit by the relevant tax authority. An uncertain income tax position will not be recognized if it has less than a 50% likelihood of being sustained. Interest and penalties on income taxes are classified as a component of the provisions for income taxes. The Group did not recognize any income tax due to uncertain tax position or incur any interest and penalties related to potential underpaid income tax expenses for the years ended December 31, 2022 and 2023, respectively. |
Value added taxes ("VAT") | Value added taxes (“VAT”) The Group is subject to VAT at the rate of 3% or 6%, depending on whether the entity is a general tax payer or small-scale taxpayer, and related surcharges on revenue generated from providing services. VAT are reported as a deduction to revenue when incurred and amounted to RMB779,116, RMB776,907 and RMB477,328 for the years ended December 31, 2021, 2022 and 2023, respectively. Entities that are VAT general taxpayers are allowed to offset qualified input VAT paid to suppliers against their output VAT liabilities. Net VAT balance between input VAT and output VAT is recorded as accrued expenses and other liabilities on the consolidated balance sheets. 1Although Issue 00-23 has also been nullified, the guidance in Issue 21 of EITF Issue 00-23 remains applicable by analogy since it is the only available guidance on accounting for these awards. |
Net income/(loss) per share | Net income/(loss) per share Basic net income per share is computed by dividing net income attributable to the ordinary shareholders by the weighted average number of ordinary shares outstanding during the period. Diluted net income per share is calculated by dividing net income attributable to the ordinary shareholders by the weighted average number of ordinary and dilutive ordinary equivalent outstanding during the period. Ordinary equivalent shares include shares issuable upon the vesting of restricted share units using the treasury stock method. Ordinary equivalent shares are not included in the denominator of the diluted earnings per share calculation when inclusion of such shares would be antidilutive. |
Comprehensive income/(loss) | Comprehensive income/(loss) Comprehensive income/(loss) is defined as the changes in equity of the Group during a period from transactions and other events and circumstances excluding transactions resulting from investments from shareholders and distributions to shareholders. Comprehensive income/(loss) for the periods presented includes net income/(loss), change in unrealized gains/(loss) on available-for-sale investments, and foreign currency translation adjustment. |
Sales and transfers of financial instruments | Sales and transfers of financial instruments Sales and transfers of financial instruments are accounted under authoritative guidance for the transfers and servicing of financial assets and extinguishment of liabilities. Specifically, a transfer of a financial asset, a group of financial assets, or a participating interest in a financial asset is accounted for as a sale only if all the following conditions are met: ● The financial assets are isolated from the transferor and its consolidated affiliates as well as its creditors; ● The transferee or beneficial interest holders have the right to pledge or exchange the transferred financial assets; and ● The transferor does not maintain effective control of the transferred asset. The Group provides loan facilitation and post-origination services to the trusts. Upon the liquidation of the trusts, the Group purchased the delinquent loans from the trusts and subsequently disposed the loans to related parties. When the loan (including the creditor rights) is transferred, the transferee becomes the direct counterparty to the borrower and the legal record holder of the loan upon the transfer. The transfer is accounted for as a sale as (1) the transferred loans are considered legally isolated from the assets of the Group and its creditors even in bankruptcies under the PRC laws and regulations, (2) the transferees can freely pledge or exchange the transferred loans, and (3) the Group does not maintain effective control over the transferred loans. The difference between the proceeds received from related parties and the fair value of the loans and other beneficial rights is recognized as “Gain on disposal of loan receivables and other beneficial rights” in the consolidated statements of operations. The Group extended loans with automobiles as collaterals and transferred its financing receivables to other assets management companies (Note 9). As the transfer of financial assets does not qualify for sale accounting, the transaction was accounted for as a borrowings. Accordingly, the related financing receivables remain on the Company’s consolidated balance sheets and continue to be reported and accounted for as if the transfer had not occurred. Cash proceeds from these transfers are reported as liabilities, with attributable interest expense recognized over the life of the related transactions. |
Foreign currency translation | Foreign currency translation The reporting currency of the Company is the Renminbi (“RMB”). The functional currency of the Company is the US dollar (“US$”). The functional currency of the Group’s subsidiaries and VIEs in the PRC is the RMB. Transactions denominated in foreign currencies are translated into the functional currency at the exchange rates prevailing on the transaction dates. Assets and liabilities denominated in foreign currencies are translated into the functional currency at the exchange rates prevailing at the balance sheet date. Exchange gains and losses are included in earnings as a component of other income. The financial statements of the Group are translated from the functional currency into the reporting currency. Assets and liabilities denominated in foreign currencies are translated using the applicable exchange rates at the balance sheet date. Equity accounts other than earnings generated in current period are translated at the appropriate historical rates. Revenues, expenses, gains and losses are translated using the periodic average exchange rates. The resulting foreign currency translation adjustment are recorded in other comprehensive (loss)/income. Translations of amounts from RMB into US$ are solely for the convenience of the reader and were calculated at the rate of US$1.00 = RMB7.0999 on December 29, 2023, the last business day in the fiscal year 2023, representing the certificated exchange rate published by the Federal Reserve Board. No representation is intended to imply that the RMB amounts could have been, or could be, converted, realized or settled into US$ at such rate, or at any other rate. |
Significant risks and uncertainties | Significant risks and uncertainties Foreign currency risk RMB is not a freely convertible currency. The State Administration for Foreign Exchange, under the authority of the People’s Bank of China, controls the conversion of RMB into foreign currencies. The value of RMB is subject to changes in central government policies and to international economic and political developments affecting supply and demand in the China Foreign Exchange Trading System market. The Group’s cash and cash equivalents denominated in RMB amounted to RMB4,246,837 and RMB5,755,750 as of December 31, 2022 and 2023, respectively. Concentration of credit risk Financial instrument that potentially exposes the Group to significant concentration of credit risk primarily includes cash and cash equivalents, restricted cash, accounts receivable, contract assets, prepaid expenses and other assets, loans at fair value, and amounts due from related parties. As of December 31, 2023, substantially all of the Group’s cash and cash equivalents and restricted cash were deposited in financial institutions located in the PRC. According to the China Bank Deposit Insurance Ordinance, the deposits at each bank are covered by insurance with an upper limit of RMB500 thousands at each bank. Accounts receivable and contract assets are typically unsecured and are derived from revenue earned from customers in the PRC. The credit risk from prepaid expenses and other assets arises from loans to third parties. The risk with respect to accounts receivable, contract assets and loans to third parties is mitigated by credit evaluations the Group performs on its customers or third parties and its ongoing monitoring process of outstanding balances. The Group believes that there is no significant credit risk associated with amounts due from related parties. Credit of loans at fair value is controlled by the application of credit approval, limit and monitoring procedures. There are no revenues from customers which individually represent greater than 10% of the total net revenues for any year of the three years ended December 31, 2021, 2022 and 2023. There was one customer of the Group accounts for 19% and 37% of the Group’s account receivables as of December 31, 2022 and 2023, respectively. |
Reclassification | Reclassification Certain prior period amount recorded in provision for contingent liability was reclassified to general and administrative and had no effect on previously reported consolidated net income/(loss) or retained earnings/(accumulated deficit). |
Recently accounting pronouncements not yet adopted | Recently accounting pronouncements not yet adopted The Group believe that no recently issued accounting standards, if currently adopted, will have a material effect on the Group’s consolidated financial statements. |
ORGANIZATION AND PRINCIPAL AC_2
ORGANIZATION AND PRINCIPAL ACTIVITIES (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
ORGANIZATION AND PRINCIPAL ACTIVITIES | |
Schedule of the company's subsidiaries and consolidated VIEs | Date of Place of Percentage incorporation/ incorporation/ of legal establishment establishment ownership Principal activities Wholly owned subsidiaries YouRace HK October 8, 2014 Hong Kong 100 % Investment holding YouRace Hengchuang January 8, 2015 PRC 100 % Provision of consultancy service, information technology support and technology-enabled borrower acquisition and facilitation services Hengyuda March 21, 2016 PRC 100 % Provision of services relating to IT, system maintenance and customer support Yiren Information Consulting (Beijing) Co., Ltd.(“Yiren Information”) August 10, 2017 PRC 100 % Provision of borrower acquisition and referral services to institutional funding providers Variable interest entities and its subsidiaries Yiren Financial Information October 13, 2016 PRC Provision of membership services CreditEase Puhui March 3, 2011 PRC Provision of borrower acquisition and borrowers related customer maintenance services Haijin Yichuang Financial Leasing Co., Ltd. (“Yichuang Financial Leasing”) March 22, 2017 PRC Provision of services for financing lease business Hexiang Insurance September 28, 2011 PRC Provision of services for insurance brokerage business |
SUMMARY OF SIGNIFICANT ACCOUN_3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
VIE arrangements | |
Schedule of disaggregation of revenue | 2021 2022 2023 RMB RMB RMB Financial services business: Loan facilitation services 2,105,776 1,362,685 2,240,852 Post origination services 174,255 204,336 17,203 Financing services 524,840 278,783 55,975 Others 379,431 113,928 201,089 Subtotal 3,184,302 1,959,732 2,515,119 Insurance brokerage business: Insurance brokerage services 755,691 731,797 963,822 Subtotal 755,691 731,797 963,822 Consumption & lifestyle business and others: Electronic commerce services 33,114 302,896 1,267,104 Others 504,822 440,195 149,588 Subtotal 537,936 743,091 1,416,692 Total net revenue 4,477,929 3,434,620 4,895,633 |
Schedule of disaggregation of revenue | 2021 2022 2023 RMB RMB RMB Insurance brokerage services: Life and health insurance business 515,436 420,273 551,809 Property & casualty insurance business 240,255 311,524 412,013 Total 755,691 731,797 963,822 |
Schedule of contract assets | As of December 31, 2022 As of December 31, 2023 RMB RMB Contract assets 780,174 1,142,192 Allowance (153,435) (164,141) Contract assets, net 626,739 978,051 |
Schedule of movement of allowance for contract assets | Year ended December 31, 2022 Year ended December 31, 2023 RMB RMB Balance at beginning of the year 350,686 153,435 Allowance for contract assets 110,888 196,426 Write-off (308,139) (185,720) Balance at end of the year 153,435 164,141 |
Schedule of the gross finance receivables by credit quality indicator buckets on a contractual basis | Year of loan origination Category As of December 31, 2022 As of December 31, 2023 RMB RMB 2019 Normal — — Concern — — Secondary — — Suspicious — — Loss 1,671 1,658 2020 Normal 80,757 — Concern 6,966 155 Secondary 18,917 1,119 Suspicious 877 1,331 Loss 1,826 18,250 2021 Normal 276,487 33,351 Concern 22,096 1,656 Secondary 49,288 5,465 Suspicious 36,368 5,544 Loss 8,045 89,104 2022 Normal 51,825 6 Concern — — Secondary — 68 Suspicious — — Loss — — 2023 Normal — 2,416 Concern — 3,221 Secondary — 3,428 Suspicious — 1,249 Loss — 1 Total 555,123 168,022 |
Summary of financing receivable | As of December 31, 2022 As of December 31, 2023 RMB RMB Financing receivables 555,123 168,022 Allowance (40,735) (51,858) Financing receivables, net 514,388 116,164 |
Summary of movement of allowance for financing receivable | Year ended December 31, 2022 Year ended December 31, 2023 RMB RMB Balance at beginning of the year 65,489 40,735 Current year net provision 38,625 32,833 Write-off (14,605) (21,710) Disposal (48,774) — Balance at end of the year 40,735 51,858 |
Schedule of estimated useful lives | Building 20 years Computer and transmission equipment 3 years Furniture and office equipment 5 years Software 1 5 Licenses Indefinite-lived Leasehold improvements Over the shorter of the lease term or expected useful lives |
VIE's | |
VIE arrangements | |
Schedule of amounts and balances included in the accompanying consolidated financial statements after elimination of intercompany transactions and balances | December 31, December 31, 2022 2023 RMB RMB Assets Cash and cash equivalents 2,795,805 3,362,736 Trading securities — 76,053 Accounts receivable 100,756 56,735 Contract assets, net 107,679 154,384 Contract cost 652 3 Prepaid expenses and other assets 114,310 45,781 Financing receivables 514,388 113,951 Amounts due from related parties 911,432 447,891 Available-for-sale investments 600,000 — Property, equipment and software, net 62,979 61,735 Deferred tax assets 84,096 73,338 Right-of-use assets 10,474 10,659 Total assets 5,302,571 4,403,266 Liabilities Accounts payable 9,196 18,211 Amounts due to related parties 214,346 6,586 Deferred revenue 9,488 15 Accrued expenses and other liabilities 1,131,504 1,243,490 Secured borrowing 767,900 — Deferred tax liabilities 17,273 20,019 Lease liabilities 9,311 9,749 Total liabilities 2,159,018 1,298,070 Years ended December 31, 2021 2022 2023 RMB RMB RMB Net revenue 3,192,329 1,821,561 1,623,596 Net income 752,164 424,834 351,373 Years ended December 31, 2021 2022 2023 RMB RMB RMB Net cash (used in)/provided by operating activities (236,406) 1,151,656 1,013,875 Net cash (used in)/provided by investing activities (393,659) 417,535 906,485 Net cash provided by/(used in) financing activities 501,400 (399,700) (963,700) |
ABFE | |
VIE arrangements | |
Schedule of amounts and balances included in the accompanying consolidated financial statements after elimination of intercompany transactions and balances | December 31, December 31, 2022 2023 RMB RMB Assets Restricted cash 88,796 267,271 Prepaid expenses and other assets 532 5,942 Loans at fair value 54,049 288,764 Held-to-maturity investments 2,300 10,420 Total assets 145,677 572,397 Liabilities Accounts payable 150 1,023 Amount due to related party 4,603 1,517 Payable to investors at fair value — 445,762 Accrued expenses and other liabilities 72 2,142 Total liabilities 4,825 450,444 Years ended December 31, 2021 2022 2023 RMB RMB RMB Net (loss)/income (38,720) 17,949 (68,024) Years ended December 31, 2021 2022 2023 RMB RMB RMB Net cash provided by/(used in) operating activities 17,016 (1,434) 211,185 Net cash provided by/(used in) investing activities 65,576 34,976 (900,142) Net cash (used in)/provided by financing activities (71,204) (85,587) 818,305 |
PREPAID EXPENSES AND OTHER AS_2
PREPAID EXPENSES AND OTHER ASSETS (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
PREPAID EXPENSES AND OTHER ASSETS | |
Schedule of prepaid expenses and other assets | December 31, December 31, 2022 2023 RMB RMB Deposits (i) 162,885 327,987 Funds receivable from external payment network providers (ii) 46,141 41,354 Prepaid expenses 4,976 17,247 Interest receivable 9,537 14,905 Guarantee receivable 3,021 2,890 Funds receivable for disposal of financing receivables 62,444 1,989 Goodwill (iii) 4,778 4,778 Others 27,629 15,361 Total 321,411 426,511 (i) As of December 31, 2022 and 2023, the balance of deposit mainly includes the business cooperation deposit of RMB 150 million and RMB 319 million, respectively. (ii) The Group opened accounts with external online payment service providers to collect the loan principal, interest and service fees. The balance of funds receivable from external payment network providers mainly includes accumulated amounts of service fees received at the balance sheet date, which was collected subsequently. (iii) In April 2020, the Group acquired an insurance brokerage licensee company for total consideration of RMB 15.5 million. The purchase price allocated to the fair value of assets acquired and liabilities assumed were RMB 53.8 million and RMB 38.3 million, respectively. RMB 4.8 million of goodwill was recognized in this acquisition. The Group did no t record any impairment of goodwill during the years ended December 31, 2021, 2022 and 2023. |
FAIR VALUE OF ASSETS AND LIAB_2
FAIR VALUE OF ASSETS AND LIABILITIES (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
FAIR VALUE OF ASSETS AND LIABILITIES | |
Schedule of fair value hierarchy for assets and liabilities measured at fair value on a recurring basis subsequent to initial recognition | December 31, 2022 Level 1 Inputs Level 2 Inputs Level 3 Inputs Balance at Fair Value RMB RMB RMB RMB Assets Cash and cash equivalents 4,271,899 — — 4,271,899 Restricted cash 88,796 — — 88,796 Loans at fair value — — 54,049 54,049 Available-for-sale investments 48,910 888,828 35,000 972,738 Total Assets 4,409,605 888,828 89,049 5,387,482 Liabilities Payable to investors at fair value (i) — — 4,603 4,603 Total Liabilities — — 4,603 4,603 December 31, 2023 Level 1 Inputs Level 2 Inputs Level 3 Inputs Balance at Fair Value RMB RMB RMB RMB Assets Cash and cash equivalents 5,791,333 — — 5,791,333 Restricted cash 267,271 — — 267,271 Trading securities 76,053 — — 76,053 Loans at fair value — — 677,835 677,835 Available-for-sale investments 276,084 127,000 35,000 438,084 Total Assets 6,410,741 127,000 712,835 7,250,576 Liabilities Payable to investors at fair value (i) — — 447,279 447,279 Total Liabilities — — 447,279 447,279 (i): Among the payable to investors at fair value, RMB4,603 and RMB1,517 are recorded as amount due to related parties as of December 31, 2022 and 2023, respectively. |
Summary of significant unobservable inputs | December 31, 2022 December 31, 2023 Range of Inputs Range of Inputs Financial Instrument Unobservable Input Weighted- Average Weighted- Average Loans at fair value Discount rates 14.0%-36.0 % 14.0%-20.0 % Net cumulative expected loss rates (i) 1.5%-12.1 % 0.5%-8.3 % Cumulative prepayment rates (ii) 10.4%-18.3 % 7.5%-18.2 % Payable to investors at fair value Discount rates 7.5%-8.6 % 7.5%-8.3 % (i) Expressed as a percentage of the loan volume. (ii) Expressed as a percentage of remaining principal of loans. |
Schedule of additional information about Level 3 loans, payable to investors measured at fair value on a recurring basis | Loans At Fair Value RMB Balance as of December 31, 2021 73,734 Origination of loans 56,147 Collection of principals (92,673) Change in fair value 16,841 Balance as of December 31, 2022 54,049 Loans At Fair Value RMB Balance as of December 31, 2022 54,049 Origination of loans 1,494,096 Collection of principals (772,398) Change in fair value (97,912) Balance as of December 31, 2023 677,835 Payable to investors At Fair Value RMB Balance as of December 31, 2021 50,686 Contribution from investors of the consolidated ABFE — Interest and penalties received 11,249 Deductible expenses associated with the consolidated ABFE operation (5,216) Principal and interest payments to investors of the consolidated ABFE (92,480) Changes in fair value (2,059) Amount due to related parties (i) 37,820 Balance as of December 31, 2022 — Payable to investors At Fair Value RMB Balance as of December 31, 2022 — Contribution from investors of the consolidated ABFE 450,000 Interest and penalties received 58,481 Deductible expenses associated with the consolidated ABFE operation (5,815) Principal and interest payments to investors of the consolidated ABFE (7,770) Changes in fair value (52,220) Amount due to related parties (i) 3,086 Balance as of December 31, 2023 445,762 (i): Among the investors of the ABFE, RMB4,603 and RMB1,517 are recorded as amount due to related parties as of December 31, 2022 and 2023, respectively. |
INVESTMENTS (Tables)
INVESTMENTS (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
INVESTMENTS | |
Schedule of information about cost and fair value of available-for-sale investments | Unrealized gains in accumulated other comprehensive Impact of December 31, 2022 Cost income exchange rate Fair value RMB RMB RMB RMB Available-for-sale investments: Bank wealth management products 888,828 — — 888,828 Debt securities 60,218 (10,154) (1,154) 48,910 Non-marketable equity investments 35,000 — — 35,000 Unrealized gains in accumulated other comprehensive Impact of December 31, 2023 Cost income exchange rate Fair value RMB RMB RMB RMB Available-for-sale investments: Bank wealth management products 127,000 — — 127,000 Debt securities 24,241 5,253 122 29,616 Non-marketable equity investments 281,410 2,406 (2,348) 281,468 |
PROPERTY, EQUIPMENT AND SOFTW_2
PROPERTY, EQUIPMENT AND SOFTWARE, NET (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
PROPERTY, EQUIPMENT AND SOFTWARE, NET | |
Schedule of property, equipment and software, net | December 31, December 31, 2022 2023 RMB RMB Building 38,464 38,464 Computer and transmission equipment 9,183 12,106 Furniture and office equipment 460 493 Leasehold improvements 4,178 4,019 Licenses 28,490 32,990 Software 39,392 39,795 Total property, equipment and software 120,167 127,867 Accumulated depreciation and amortization 42,911 48,709 Property, equipment and software, net 77,256 79,158 |
ACCRUED EXPENSES AND OTHER LI_2
ACCRUED EXPENSES AND OTHER LIABILITIES (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
ACCRUED EXPENSES AND OTHER LIABILITIES | |
Schedule of accrued expenses and other liabilities | December 31, December 31, 2022 2023 RMB RMB Tax payable 562,839 931,191 Accrued payroll and welfare 403,104 153,554 Payable to investors (i) 147,864 145,655 Accrued advertisement expenses 58,707 134,601 Guarantee liabilities 51,766 37,153 Funds collected on behalf of third-party guarantee companies 18,766 11,387 Accrued customer incentives 5,024 3,263 Others 66,936 83,718 Total accrued expenses and other liabilities 1,315,006 1,500,522 (i) Payable to investor represents interest and principal collected by the Group on behalf of lenders. |
RELATED PARTY BALANCES AND TR_2
RELATED PARTY BALANCES AND TRANSACTIONS (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
RELATED PARTY BALANCES AND TRANSACTIONS | |
Schedule of major related parties and their relationship with the Group | Relationship with the Major transaction with the Company name Group Group Pucheng Credit Assessment and Management (Beijing) Co., Ltd. (“Pucheng Credit”) Subsidiary of Consolidated VIE of CreditEase Collection services, management consulting services, customers acquisition and referral services and related party loans Puxin Subsidiary of CreditEase System support services and sales of goods Zhuoyue Consolidated VIE of CreditEase Customers acquisition and referral services and related party loans Beijing Zhicheng Credit Service Co., Ltd. (“Beijing Zhicheng”) Consolidated VIE of CreditEase Credit assessment services Zhicheng A’Fu Technology Development Co.,Ltd. (“Zhicheng A’Fu”) Consolidated VIE of CreditEase Credit assessment services Hengcheng Consolidated VIE of CreditEase (from January 2021) Post-loan management services, technical support services and acquisition and referral services China Rise Insurance Broker Limited ("Huajin") Subsidiary of Consolidated VIE of CreditEase Customers acquisition and referral services Xinda Hongtao Technology Development (Beijing) Co., Ltd. (“Xinda Hongtao”) Consolidated VIE of CreditEase Customers acquisition and referral services Goodhope Entry-Exit Consulting Services (Beijing) Company Limited. (“Goodhope”) Consolidated VIE of CreditEase Sales of goods Creditease Puze (Beijing) Fund Sales Co., Ltd. (“Creditease Puze”) Subsidiary of Consolidated VIE of CreditEase Customers acquisition and referral services Hengda Hongyuan International Technology Development (Beijing) Co., Ltd. (“Hengda Hongyuan”) Subsidiary of Consolidated VIE of CreditEase Financing services through transfer of financial lease receivables CreditEase E-Share Technology (Beijing) Limited ("Qixiang") Consolidated VIE of CreditEase Customers acquisition and referral services Chongqing Chengyuan Future E-commerce Service Co., Ltd. Consolidated VIE of CreditEase System support services Hainan CreditEase Puhui Small Loan Co., Ltd. (“Hainan CreditEase”) Subsidiary of Consolidated VIE of CreditEase Customers acquisition and referral services Ruicheng Family Information Consulting (Beijing) Co., Ltd.(“Ruicheng”) Consolidated VIE of CreditEase Customers acquisition and referral services |
Schedule of cost and expense incurred for services provided by CreditEase, its subsidiaries and affiliates | Years ended December 31, 2021 2022 2023 RMB RMB RMB Customers acquisition and referral services 281,633 216,958 175,471 Credit assessment services 56,957 110,566 118,395 System support services 135,118 100,635 72,035 Collection services 17,943 22,735 29,188 Others services — 91 1,824 Total costs and expenses 491,651 450,985 396,913 |
Schedule of revenue derived from services provided by CreditEase, its subsidiaries and affiliates | Years ended December 31, 2021 2022 2023 RMB RMB RMB Customers acquisition and referral service 442,570 409,688 140,782 Technical services 85,832 — — Post-loan management services 44,586 — — Others services 170 1,322 813 Total revenue 573,158 411,010 141,595 |
Schedule of amount of loans collected from/(issued to) related party | Years ended December 31, 2021 2022 2023 RMB RMB RMB Pucheng Credit — (200,000) — Total — (200,000) — |
Schedule of amount of loans received from/ (repaid to) related party | Years ended December 31, 2021 2022 2023 RMB RMB RMB Qichuang — (43,000) — Hengda Hongyuan (a) (26,700) (139,000) (195,800) Total (26,700) (182,000) (195,800) (a) |
Schedule of related party balances | (i) December 31, December 31, 2022 2023 RMB RMB Zhuoyue (a) 549,699 310,354 Pucheng Credit (f) 204,000 203,353 Puxin (Note b) 195,406 139,071 Huichuang (a) 88,887 76,118 Hainan CreditEase (a) 20,259 26,073 Hengcheng (c) 172,103 — Others 35,878 65,212 Total 1,266,232 820,181 (ii) December 31, December 31, 2022 2023 RMB RMB Hengda Hongyuan (e) 198,045 — Pucheng Credit (d) 12,162 9,084 Zhicheng A’Fu (d) 10,293 3,786 Others 7,224 1,544 Total 227,724 14,414 (a) (b) (c) (d) (e) (f) |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
INCOME TAXES | |
Schedule of income tax (benefits)/expenses | December 31, December 31, December 31, 2021 2022 2023 RMB RMB RMB Current tax 85,198 410,106 512,054 Deferred tax 84,991 (109,594) 53,109 Total 170,189 300,512 565,163 |
Schedule of reconciliation between the income tax at PRC statutory tax rate and income tax expense | Years ended December 31, 2021 2022 2023 RMB RMB RMB Income before provision for income taxes 1,203,173 1,495,383 2,645,360 Statutory tax rate in the PRC 25 % 25 % 25 % Income tax expenses at statutory tax rate 300,793 373,846 661,340 Non-deductible expenses 12,663 365 — Research and development super deduction (8,508) (5,697) (11,620) Effect of income not taxable (24,604) (29,398) (58,359) Effect of tax holiday and preferential tax rate (132,485) (45,074) (108,806) Adjustment on current income tax of the prior periods (5,614) (9,085) 80 Effect of different tax rates of subsidiaries operating in other jurisdictions 28,072 5,731 26,793 Withholding income tax — — 40,000 Change in valuation allowance (128) 9,824 15,735 Income tax expenses 170,189 300,512 565,163 |
Schedule of aggregate amount and per share effect of the tax holiday and preferential tax rate | Years ended December 31, 2021 2022 2023 RMB RMB RMB The aggregate amount of tax holiday and preferential tax rate (132,485) (45,074) (108,806) The aggregate effect on basic and diluted net income per share: - Basic (0.7838) (0.2580) (0.6156) - Diluted (0.7766) (0.2570) (0.6089) |
Schedule of deferred tax assets and liabilities | December 31, December 31, 2022 2023 RMB RMB Deferred tax assets: Deferred revenue 10,783 8,105 Accrued expenses and other liabilities 15,402 11,181 Fair value changes 17,556 17,350 Allowance for uncollectible receivables 113,836 121,080 Advertising expenses in excess of deduction limit — 2,068 Valuation allowance (i) (40,567) (38,545) Total 117,010 121,239 Deferred tax liabilities: Contract assets, net 105,252 162,767 Contract cost 188 10 Intangible assets 7,123 7,123 Total 112,563 169,900 Net deferred tax assets/(liabilities) 4,447 (48,661) (i) A valuation allowance is provided against deferred tax assets when the Group determines that it is more likely than not that the deferred tax assets will not be utilized in the future. In making such determination, the Group evaluates a variety of factors including the Group’s entities’ operating history, accumulated deficit, forecasts of future profitability, existence of taxable temporary differences and reversal periods. The valuation allowance is considered on an individual entity basis. The Group has recognized a valuation allowance against deferred tax assets of RMB40,567 and RMB38,545 for the years ended December 31, 2022 and 2023, respectively. |
SHARE-BASED COMPENSATION (Table
SHARE-BASED COMPENSATION (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
SHARE-BASED COMPENSATION | |
Summary of restricted share units activities | Weighted-Average Grant-Date Number of RSUs Fair Value US$ Unvested as of December 31, 2021 2,639,196 3.18 Granted 10,922,272 0.89 Vested (9,442,362) 1.15 Forfeited (915,276) 2.74 Unvested as of December 31, 2022 3,203,830 1.48 Granted 909,842 0.90 Vested (1,349,098) 1.62 Forfeited (604,826) 1.42 Unvested as of December 31, 2023 2,159,748 1.17 |
NET INCOME PER SHARE AND NET _2
NET INCOME PER SHARE AND NET INCOME ATTRIBUTABLE TO ORDINARY SHAREHOLDERS (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
NET INCOME PER SHARE AND NET INCOME ATTRIBUTABLE TO ORDINARY SHAREHOLDERS | |
Schedule of the computation of the basic and diluted net income per share | Years ended December 31, 2021 2022 2023 RMB RMB RMB Numerator: Net income 1,032,984 1,194,871 2,080,197 Denominator: Weighted average number of ordinary shares outstanding, basic 169,029,826 174,695,959 176,749,706 Plus incremental weighted average ordinary shares from assumed vesting of RSUs using the treasury stock method 1,560,377 695,373 1,938,613 Weighted average number of ordinary shares outstanding, diluted 170,590,203 175,391,332 178,688,319 Basic net income per share 6.1113 6.8397 11.7692 Diluted net income per share 6.0554 6.8126 11.6415 |
LEASES (Tables)
LEASES (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
LEASES | |
Summary of supplemental information related to operating leases | Year ended Year ended December 31, 2022 December 31, 2023 Operating lease ROU assets 33,909 23,382 Operating lease liabilities 35,229 23,648 Operating leases - Weighted average remaining lease term 2.11 years 1.46 years Operating leases - Weighted average discount rate 3.3 % 3.3 % |
Summary of lease cost | Year ended Year ended December 31, 2022 December 31, 2023 Operating lease cost 27,715 19,209 Short-term lease cost 192 168 Total 27,907 19,377 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows for operating leases 17,743 20,263 Non-cash ROU assets in exchange for new lease liabilities: Operating leases 12,289 7,958 |
Summary of maturity of operating lease liabilities | As of December 31, As of December 31, 2022 2023 RMB RMB 2023 17,945 — 2024 16,304 18,976 2025 2,253 4,445 2026 — 821 2027 and thereafter — — Subtotal 36,502 24,242 Less: imputed interest 1,273 594 Present value of operating lease liabilities 35,229 23,648 |
SEGMENT INFORMATION (Tables)
SEGMENT INFORMATION (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
SEGMENT INFORMATION | |
Summary of each segment's operating results | Years ended December 31, 2021 2022 2023 RMB RMB RMB Net revenue: Financial services business 3,184,302 1,959,732 2,515,119 Insurance brokerage business 755,691 731,797 963,822 Consumption & lifestyle business and others 537,936 743,091 1,416,692 Total net revenue 4,477,929 3,434,620 4,895,633 Operating costs and expenses: Financial services business (2,130,221) (878,375) (1,108,663) Insurance brokerage business (556,111) (566,538) (724,652) Consumption & lifestyle business and others (406,453) (370,268) (283,948) Income from operations: Financial services business 1,054,081 1,081,357 1,406,456 Insurance brokerage business 199,580 165,259 239,170 Consumption & lifestyle business and others 131,483 372,823 1,132,744 Total segment income from operations 1,385,144 1,619,439 2,778,370 Unallocated expenses (97,811) (147,575) (183,588) Other (expenses)/income (84,160) 23,519 50,578 Income before provision for income taxes 1,203,173 1,495,383 2,645,360 |
ORGANIZATION AND PRINCIPAL AC_3
ORGANIZATION AND PRINCIPAL ACTIVITIES - Summary of Major Subsidiaries (Details) | Dec. 31, 2023 |
YouRace HK | |
Subsidiaries ownership: | |
Percentage of legal ownership | 100% |
YouRace Hengchuang | |
Subsidiaries ownership: | |
Percentage of legal ownership | 100% |
Heng Yu Da | |
Subsidiaries ownership: | |
Percentage of legal ownership | 100% |
Yiren Information | |
Subsidiaries ownership: | |
Percentage of legal ownership | 100% |
SUMMARY OF SIGNIFICANT ACCOUN_4
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Consolidated VIE (Details) ¥ in Thousands, $ in Thousands | 12 Months Ended | ||||
Dec. 31, 2023 CNY (¥) | Dec. 31, 2023 USD ($) | Dec. 31, 2022 CNY (¥) | Dec. 31, 2021 CNY (¥) | Dec. 31, 2023 USD ($) | |
Assets | |||||
Cash and cash equivalents | ¥ 5,791,333 | ¥ 4,271,899 | ¥ 2,864,543 | $ 815,692 | |
Restricted cash | 267,271 | 88,796 | 80,800 | 37,644 | |
Trading securities | 76,053 | 10,712 | |||
Accounts receivable | 499,027 | 221,004 | 70,287 | ||
Contract assets, net | 978,051 | 626,739 | 137,756 | ||
Contract cost | 32 | 787 | 4 | ||
Prepaid expenses and other assets | 426,511 | 321,411 | 60,073 | ||
Financing receivables | 116,164 | 514,388 | 16,361 | ||
Available-for-sale investments | 438,084 | 972,738 | 61,703 | ||
Property, equipment and software, net | 79,158 | 77,256 | 11,149 | ||
Deferred tax assets | 73,414 | 84,187 | 10,340 | ||
Total assets | 10,276,916 | 8,536,095 | 1,447,473 | ||
Liabilities | |||||
Accounts payable | 30,902 | 14,144 | 4,353 | ||
Deferred revenue | 54,044 | 65,539 | 7,612 | ||
Accrued expenses and other liabilities | 1,500,522 | 1,315,006 | 211,344 | ||
Secured borrowing | 0 | 767,900 | |||
Deferred tax liabilities | 122,075 | 79,740 | 17,194 | ||
Lease liabilities | 23,648 | 35,229 | 3,331 | ||
Total liabilities | 2,191,367 | 2,505,282 | 308,648 | ||
Net revenue | 4,895,633 | $ 689,535 | 3,434,620 | 4,477,929 | |
Net income | 2,080,197 | 292,990 | 1,194,871 | 1,032,984 | |
Net cash provided by/(used in) operating activities | 2,171,013 | 305,780 | 1,849,430 | 158,192 | |
Net cash provided by/(used in) investing activities | 100,045 | 14,091 | 52,559 | (346,507) | |
Net cash (used in)/provided by financing activities | (569,278) | $ (80,181) | (489,123) | 427,446 | |
Related parties | |||||
Assets | |||||
Amounts due from related parties | 820,181 | 1,266,232 | 115,520 | ||
Liabilities | |||||
Other liabilities | 14,414 | 227,724 | $ 2,030 | ||
Net revenue | 141,595 | 411,010 | 573,158 | ||
VIE's | |||||
Assets | |||||
Cash and cash equivalents | 3,362,736 | 2,795,805 | |||
Trading securities | 76,053 | ||||
Accounts receivable | 56,735 | 100,756 | |||
Contract assets, net | 154,384 | 107,679 | |||
Contract cost | 3 | 652 | |||
Prepaid expenses and other assets | 45,781 | 114,310 | |||
Financing receivables | 113,951 | 514,388 | |||
Available-for-sale investments | 600,000 | ||||
Property, equipment and software, net | 61,735 | 62,979 | |||
Deferred tax assets | 73,338 | 84,096 | |||
Right-of-use assets | 10,659 | 10,474 | |||
Total assets | 4,403,266 | 5,302,571 | |||
Liabilities | |||||
Accounts payable | 18,211 | 9,196 | |||
Deferred revenue | 15 | 9,488 | |||
Accrued expenses and other liabilities | 1,243,490 | 1,131,504 | |||
Secured borrowing | 767,900 | ||||
Deferred tax liabilities | 20,019 | 17,273 | |||
Lease liabilities | 9,749 | 9,311 | |||
Total liabilities | 1,298,070 | 2,159,018 | |||
Net revenue | 1,623,596 | 1,821,561 | 3,192,329 | ||
Net income | 351,373 | 424,834 | 752,164 | ||
Net cash provided by/(used in) operating activities | 1,013,875 | 1,151,656 | (236,406) | ||
Net cash provided by/(used in) investing activities | 906,485 | 417,535 | (393,659) | ||
Net cash (used in)/provided by financing activities | (963,700) | (399,700) | ¥ 501,400 | ||
VIE's | Asset pledged as collateral | |||||
Assets | |||||
Total assets | 0 | ||||
VIE's | Related parties | |||||
Assets | |||||
Amounts due from related parties | 447,891 | 911,432 | |||
Liabilities | |||||
Other liabilities | ¥ 6,586 | ¥ 214,346 | |||
Loan agreements between FOS and each of the shareholders of the respective VIE companies | |||||
VIE arrangements | |||||
Threshold of foreign interest in VIE (as a percent) | 100% | 100% | |||
Term of loans (years) | 10 years | 10 years |
SUMMARY OF SIGNIFICANT ACCOUN_5
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Consolidated Assets Backed Financing Entities (Details) ¥ in Thousands, $ in Thousands | 12 Months Ended | ||||
Dec. 31, 2023 CNY (¥) | Dec. 31, 2023 USD ($) | Dec. 31, 2022 CNY (¥) | Dec. 31, 2021 CNY (¥) | Dec. 31, 2023 USD ($) | |
Assets | |||||
Restricted cash | ¥ 267,271 | ¥ 88,796 | ¥ 80,800 | $ 37,644 | |
Prepaid expenses and other assets | 426,511 | 321,411 | 60,073 | ||
Loans at fair value | 677,835 | 54,049 | 95,471 | ||
Held-to-maturity investments | 10,420 | 2,700 | 1,468 | ||
Total assets | 10,276,916 | 8,536,095 | 1,447,473 | ||
Liabilities | |||||
Accounts payable | 30,902 | 14,144 | 4,353 | ||
Accrued expenses and other liabilities | 1,500,522 | 1,315,006 | 211,344 | ||
Total liabilities | 2,191,367 | 2,505,282 | 308,648 | ||
Net income | 2,080,197 | $ 292,990 | 1,194,871 | 1,032,984 | |
Net cash provided by/(used in) operating activities | 2,171,013 | 305,780 | 1,849,430 | 158,192 | |
Net cash provided by investing activities | 100,045 | 14,091 | 52,559 | (346,507) | |
Net cash (used in)/provided by financing activities | (569,278) | $ (80,181) | (489,123) | 427,446 | |
Related Party | |||||
Liabilities | |||||
Other liabilities | 14,414 | 227,724 | 2,030 | ||
Payable to investors at fair value | |||||
Liabilities | |||||
Other liabilities | 445,762 | 0 | $ 62,784 | ||
ABFE | |||||
Assets | |||||
Restricted cash | 267,271 | 88,796 | |||
Prepaid expenses and other assets | 5,942 | 532 | |||
Loans at fair value | 288,764 | 54,049 | |||
Held-to-maturity investments | 10,420 | 2,300 | |||
Total assets | 572,397 | 145,677 | |||
Liabilities | |||||
Accounts payable | 1,023 | 150 | |||
Accrued expenses and other liabilities | 2,142 | 72 | |||
Total liabilities | 450,444 | 4,825 | |||
Net income | (68,024) | 17,949 | (38,720) | ||
Net cash provided by/(used in) operating activities | 211,185 | (1,434) | 17,016 | ||
Net cash provided by investing activities | (900,142) | 34,976 | 65,576 | ||
Net cash (used in)/provided by financing activities | 818,305 | (85,587) | ¥ (71,204) | ||
ABFE | Excluding Affiliated Entity | |||||
Liabilities | |||||
Other liabilities | 1,517 | ¥ 4,603 | |||
ABFE | Payable to investors at fair value | |||||
Liabilities | |||||
Other liabilities | 445,762 | ||||
Asset pledged as collateral | ABFE | |||||
Assets | |||||
Total assets | ¥ 0 |
SUMMARY OF SIGNIFICANT ACCOUN_6
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Revenue Disaggregation (Details) ¥ in Thousands, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2023 CNY (¥) | Dec. 31, 2023 USD ($) | Dec. 31, 2022 CNY (¥) | Dec. 31, 2021 CNY (¥) | |
Net revenue | ||||
Net revenue | ¥ 4,895,633 | $ 689,535 | ¥ 3,434,620 | ¥ 4,477,929 |
Financial services business | ||||
Net revenue | ||||
Net revenue | 2,515,119 | 1,959,732 | 3,184,302 | |
Insurance brokerage business | ||||
Net revenue | ||||
Net revenue | 963,822 | 731,797 | 755,691 | |
Consumption & lifestyle business and other | ||||
Net revenue | ||||
Net revenue | 1,416,692 | 743,091 | 537,936 | |
Loan facilitation service | Financial services business | ||||
Net revenue | ||||
Net revenue | 2,240,852 | 1,362,685 | 2,105,776 | |
Post origination services | Financial services business | ||||
Net revenue | ||||
Net revenue | 17,203 | 204,336 | 174,255 | |
Financing services | Financial services business | ||||
Net revenue | ||||
Net revenue | 55,975 | 278,783 | 524,840 | |
Insurance brokerage services | ||||
Net revenue | ||||
Net revenue | 963,822 | 731,797 | 755,691 | |
Insurance brokerage services | Insurance brokerage business | ||||
Net revenue | ||||
Net revenue | 963,822 | 731,797 | 755,691 | |
Others | Financial services business | ||||
Net revenue | ||||
Net revenue | 201,089 | 113,928 | 379,431 | |
Others | Consumption & lifestyle business and other | ||||
Net revenue | ||||
Net revenue | 149,588 | 440,195 | 504,822 | |
Electronic commerce services | Consumption & lifestyle business and other | ||||
Net revenue | ||||
Net revenue | ¥ 1,267,104 | ¥ 302,896 | ¥ 33,114 |
SUMMARY OF SIGNIFICANT ACCOUN_7
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Disaggregation of revenue (Details) ¥ in Thousands, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2023 CNY (¥) | Dec. 31, 2023 USD ($) | Dec. 31, 2022 CNY (¥) | Dec. 31, 2021 CNY (¥) | |
Net revenue | ||||
Net revenue | ¥ 4,895,633 | $ 689,535 | ¥ 3,434,620 | ¥ 4,477,929 |
Consumption & lifestyle business and other | ||||
Net revenue | ||||
Net revenue | ¥ 1,416,692 | ¥ 743,091 | 537,936 | |
Percentage of revenue on total e-commerce revenue | 99.70% | 99.70% | 99.10% | |
Insurance brokerage services | ||||
Net revenue | ||||
Net revenue | ¥ 963,822 | ¥ 731,797 | ¥ 755,691 | |
Percentage of renewal commission revenue on segment revenue | 6% | 6% | 9.70% | 9.20% |
Life and health insurance business | ||||
Net revenue | ||||
Net revenue | ¥ 551,809 | ¥ 420,273 | ¥ 515,436 | |
Property and casualty insurance business | ||||
Net revenue | ||||
Net revenue | ¥ 412,013 | ¥ 311,524 | ¥ 240,255 |
SUMMARY OF SIGNIFICANT ACCOUN_8
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Revenue on the remaining performance obligations (Details) ¥ in Thousands, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2023 CNY (¥) | Dec. 31, 2023 USD ($) | Dec. 31, 2022 CNY (¥) | Dec. 31, 2021 CNY (¥) | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||||
Net revenue | ¥ 4,895,633 | $ 689,535 | ¥ 3,434,620 | ¥ 4,477,929 |
No-reason return period | 7 days | 7 days | ||
Post origination services | ||||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||||
Revenue on the remaining performance obligations | ¥ 3,600 | ¥ 12,500 | ||
Health and life insurance | Minimum | ||||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||||
Insurance policy term | 5 years | 5 years | ||
Property insurance | ||||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||||
Insurance policy term | 1 year | 1 year | ||
Property insurance | Maximum | ||||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||||
Insurance policy term | 10 years | 10 years | ||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-01-01 | Post origination services | ||||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||||
Percentage of remaining performance obligation expected to be recognized | 99% | |||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2024-01-01 | Post origination services | ||||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||||
Percentage of remaining performance obligation expected to be recognized | 100% | |||
Revenue on the remaining performance obligation, Period | 12 months |
SUMMARY OF SIGNIFICANT ACCOUN_9
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Contract Assets, Contract Liabilities and Refund liability (Details) ¥ in Thousands, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 CNY (¥) | Dec. 31, 2022 CNY (¥) | Dec. 31, 2023 USD ($) | |
Contract Cost | |||
Amortization on Contract cost | ¥ 700 | ¥ 17,800 | |
Impairment loss on contract costs | 0 | 0 | |
Contract assets | |||
Contract assets | 1,142,192 | 780,174 | |
Allowance | (164,141) | (153,435) | |
Contract assets, net | 978,051 | 626,739 | $ 137,756 |
Movement of allowance for contract assets | |||
Balance at beginning of the year | 153,435 | 350,686 | |
Allowance for contract assets | 196,426 | 110,888 | |
Write-off | (185,720) | (308,139) | |
Balance at end of the year | 164,141 | 153,435 | |
Deferred revenue | |||
Revenue recognized that was included in opening deferred revenue | ¥ 65,500 | ¥ 2,100 |
SUMMARY OF SIGNIFICANT ACCOU_10
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Financing Receivable (Details) - CNY (¥) ¥ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Financing receivable | ¥ 168,022 | ¥ 555,123 | |
Allowance | (51,858) | (40,735) | |
Financing receivable, net | 116,164 | 514,388 | |
Accrued interest receivable | ¥ 3,500 | ¥ 53,100 | |
Financing Receivable, Accrued Interest, after Allowance for Credit Loss, Statement of Financial Position [Extensible Enumeration] | Financing Receivable and Net Investment in Lease, Current, after Allowance for Credit Loss | Financing Receivable and Net Investment in Lease, Current, after Allowance for Credit Loss | |
Accrued interest receivable, net of allowance | ¥ 1,200 | ¥ 2,100 | |
Financing receivables, allowance | ¥ 51,858 | ¥ 40,735 | |
Financing receivable, average loan period | 0 months | 27 months | 26 months 6 days |
Overdue | |||
Financing receivable | ¥ 132,200 | ¥ 146,100 | |
Overdue for more than 90 days | |||
Loans overdue for more than 90 days | ¥ 127,200 | ¥ 117,000 |
SUMMARY OF SIGNIFICANT ACCOU_11
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Finance receivable by credit quality indicator (Details) - CNY (¥) ¥ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Total | ¥ 168,022 | ¥ 555,123 |
Normal | ||
2020 | 80,757 | |
2021 | 33,351 | 276,487 |
2022 | 6 | 51,825 |
2023 | 2,416 | |
Concern | ||
2020 | 155 | 6,966 |
2021 | 1,656 | 22,096 |
2023 | 3,221 | |
Secondary | ||
2020 | 1,119 | 18,917 |
2021 | 5,465 | 49,288 |
2022 | 68 | |
2023 | 3,428 | |
Suspicious | ||
2020 | 1,331 | 877 |
2021 | 5,544 | 36,368 |
2023 | 1,249 | |
Loss | ||
2019 | 1,658 | 1,671 |
2020 | 18,250 | 1,826 |
2021 | 89,104 | ¥ 8,045 |
2023 | ¥ 1 |
SUMMARY OF SIGNIFICANT ACCOU_12
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Movement of Allowance for Financing Receivable (Details) - CNY (¥) ¥ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Financing Receivable, Allowance for Credit Loss [Roll Forward] | |||
Balance at beginning of the year | ¥ 40,735 | ¥ 65,489 | |
Current year net provision | 32,833 | 38,625 | ¥ 35,300 |
Write-off | (21,710) | (14,605) | |
Disposal | 0 | (48,774) | |
Balance at end of the year | ¥ 51,858 | ¥ 40,735 | ¥ 65,489 |
Loan term of financing receivables | 24 months |
SUMMARY OF SIGNIFICANT ACCOU_13
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Asset Acquisition, Business Acquisition and Property, Equipment and Software, Net (Details) - CNY (¥) ¥ in Thousands | 1 Months Ended | |||
Jul. 31, 2023 | Dec. 31, 2023 | Dec. 31, 2022 | Apr. 30, 2020 | |
Business Acquisition | ||||
Goodwill | ¥ 4,778 | ¥ 4,778 | ||
Asset Acquisition | ||||
Total consideration for license | ¥ 204,900 | |||
An insurance brokerage licensee company | ||||
Business Acquisition | ||||
Fair value of assets acquired | ¥ 53,800 | |||
Fair value of liabilities assumed | 38,300 | |||
Goodwill | ¥ 4,800 | |||
Building | ||||
Property, equipment and software, net | ||||
Useful life (in years) | 20 years | |||
Estimate residual value (as a percent) | 5% | |||
Computer and transmission equipment | ||||
Property, equipment and software, net | ||||
Useful life (in years) | 3 years | |||
Furniture and office equipment | ||||
Property, equipment and software, net | ||||
Useful life (in years) | 5 years | |||
Estimate residual value (as a percent) | 5% | |||
Software | Minimum | ||||
Property, equipment and software, net | ||||
Useful life (in years) | 1 year | |||
Software | Maximum | ||||
Property, equipment and software, net | ||||
Useful life (in years) | 5 years |
SUMMARY OF SIGNIFICANT ACCOU_14
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Leases (Details) | 12 Months Ended |
Dec. 31, 2023 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Remaining lease terms | 3 years |
Option to extend | true |
SUMMARY OF SIGNIFICANT ACCOU_15
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Accounts receivable and allowance for uncollectible accounts receivable and Value added taxes (Details) - CNY (¥) ¥ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |||
Allowance for accounts receivable | ¥ 46,715 | ¥ 18,235 | |
VAT percent, one | 3% | ||
VAT percent, two | 6% | ||
VAT tax | ¥ 477,328 | ¥ 776,907 | ¥ 779,116 |
SUMMARY OF SIGNIFICANT ACCOU_16
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Foreign Currency Translation (Details) | Dec. 29, 2023 |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Exchange rate | 7.0999 |
SUMMARY OF SIGNIFICANT ACCOU_17
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Significant Risks and Uncertainties (Details) ¥ in Thousands, $ in Thousands | 12 Months Ended | ||||
Dec. 31, 2023 CNY (¥) customer | Dec. 31, 2023 USD ($) customer | Dec. 31, 2022 CNY (¥) customer | Dec. 31, 2021 CNY (¥) | Dec. 31, 2023 USD ($) | |
Significant Risks and Uncertainties | |||||
Cash and cash equivalents | ¥ 5,791,333 | ¥ 4,271,899 | ¥ 2,864,543 | $ 815,692 | |
Net revenue | 4,895,633 | $ 689,535 | 3,434,620 | 4,477,929 | |
Customer concentration risk | |||||
Significant Risks and Uncertainties | |||||
Insurance limit covering deposits at each bank | 500 | ||||
Cash and cash equivalents | Foreign currency risk | RMB | |||||
Significant Risks and Uncertainties | |||||
Cash and cash equivalents | 5,755,750 | 4,246,837 | |||
Individual customer greater than 10% of revenue | Customer concentration risk | |||||
Significant Risks and Uncertainties | |||||
Net revenue | ¥ 0 | ¥ 0 | ¥ 0 | ||
Customer greater than 10% of accounts receivable | Customer concentration risk | One Customer | |||||
Significant Risks and Uncertainties | |||||
Number of customers | customer | 1 | 1 | 1 | ||
Concentration risk (as a percent) | 37% | 37% | 19% |
PREPAID EXPENSES AND OTHER AS_3
PREPAID EXPENSES AND OTHER ASSETS (Details) ¥ in Thousands, $ in Thousands | Dec. 31, 2023 CNY (¥) | Dec. 31, 2023 USD ($) | Dec. 31, 2022 CNY (¥) |
PREPAID EXPENSES AND OTHER ASSETS | |||
Deposits (i) | ¥ 327,987 | ¥ 162,885 | |
Funds receivable from external payment network providers (ii) | 41,354 | 46,141 | |
Prepaid expenses | 17,247 | 4,976 | |
Interest receivable | 14,905 | 9,537 | |
Guarantee receivable | 2,890 | 3,021 | |
Funds receivable for disposal of financing receivables | 1,989 | 62,444 | |
Goodwill | 4,778 | 4,778 | |
Others | 15,361 | 27,629 | |
Total | ¥ 426,511 | $ 60,073 | ¥ 321,411 |
PREPAID EXPENSES AND OTHER AS_4
PREPAID EXPENSES AND OTHER ASSETS - Additional information (Details) ¥ in Thousands, $ in Millions | 1 Months Ended | 12 Months Ended | ||||
Apr. 30, 2020 CNY (¥) | Dec. 31, 2023 USD ($) | Dec. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) | Dec. 31, 2023 CNY (¥) | Dec. 31, 2022 CNY (¥) | |
Prepaid expenses and other assets: | ||||||
Business cooperation deposit | ¥ 319,000 | ¥ 150,000 | ||||
Goodwill | ¥ 4,778 | ¥ 4,778 | ||||
Impairment of goodwill | $ | $ 0 | $ 0 | $ 0 | |||
Insurance brokerage | ||||||
Prepaid expenses and other assets: | ||||||
Total consideration | ¥ 15,500 | |||||
Fair value of assets acquired | 53,800 | |||||
Fair value of liabilities assumed | 38,300 | |||||
Goodwill | ¥ 4,800 |
FAIR VALUE OF ASSETS AND LIAB_3
FAIR VALUE OF ASSETS AND LIABILITIES (Details) - CNY (¥) ¥ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
FAIR VALUE OF ASSETS AND LIABILITIES | ||
Assets transferred into Level 3 | ¥ 0 | ¥ 0 |
Assets transferred out of Level 3 | 0 | 0 |
Liabilities transferred into Level 3 | 0 | 0 |
Liabilities transferred out of Level 3 | ¥ 0 | ¥ 0 |
FAIR VALUE OF ASSETS AND LIAB_4
FAIR VALUE OF ASSETS AND LIABILITIES -Schedule of the Fair Value Hierarchy (Details) ¥ in Thousands, $ in Thousands | Dec. 31, 2023 CNY (¥) | Dec. 31, 2023 USD ($) | Dec. 31, 2022 CNY (¥) | Dec. 31, 2021 CNY (¥) |
Assets | ||||
Cash and cash equivalents | ¥ 5,791,333 | $ 815,692 | ¥ 4,271,899 | |
Restricted cash | 267,271 | 37,644 | 88,796 | ¥ 80,800 |
Trading securities | 76,053 | 10,712 | ||
Loans at fair value | 677,835 | 95,471 | 54,049 | |
Available-for-sale investments | 438,084 | 61,703 | 972,738 | |
Related Party | ||||
Liabilities | ||||
Other liabilities | 14,414 | 2,030 | 227,724 | |
Payable to investors at fair value | ||||
Liabilities | ||||
Other liabilities | 445,762 | $ 62,784 | 0 | |
Recurring | ||||
Assets | ||||
Cash and cash equivalents | 5,791,333 | 4,271,899 | ||
Restricted cash | 267,271 | 88,796 | ||
Trading securities | 76,053 | |||
Loans at fair value | 677,835 | 54,049 | ||
Available-for-sale investments | 438,084 | 972,738 | ||
Total Assets | 7,250,576 | 5,387,482 | ||
Liabilities | ||||
Total Liabilities | 447,279 | 4,603 | ||
Recurring | Payable to investors at fair value | ||||
Liabilities | ||||
Other liabilities | 447,279 | 4,603 | ||
Recurring | Level 1 Inputs | ||||
Assets | ||||
Cash and cash equivalents | 5,791,333 | 4,271,899 | ||
Restricted cash | 267,271 | 88,796 | ||
Trading securities | 76,053 | |||
Available-for-sale investments | 276,084 | 48,910 | ||
Total Assets | 6,410,741 | 4,409,605 | ||
Recurring | Level 2 Inputs | ||||
Assets | ||||
Available-for-sale investments | 127,000 | 888,828 | ||
Total Assets | 127,000 | 888,828 | ||
Recurring | Level 3 Inputs | ||||
Assets | ||||
Loans at fair value | 677,835 | 54,049 | ||
Available-for-sale investments | 35,000 | 35,000 | ||
Total Assets | 712,835 | 89,049 | ||
Liabilities | ||||
Total Liabilities | 447,279 | 4,603 | ||
Recurring | Level 3 Inputs | Payable to investors at fair value | ||||
Liabilities | ||||
Other liabilities | ¥ 447,279 | ¥ 4,603 |
FAIR VALUE OF ASSETS AND LIAB_5
FAIR VALUE OF ASSETS AND LIABILITIES - Summary of Significant Unobservable Inputs (Details) | Dec. 31, 2023 | Dec. 31, 2022 |
Minimum | Discount rates | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Loans at Fair vlaue | 14% | 14% |
Payable to investors at fair value | 7.50% | 7.50% |
Minimum | Net cumulative expected loss rates | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Loans at Fair vlaue | 0.50% | 1.50% |
Minimum | Cumulative prepayment rates | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Loans at Fair vlaue | 7.50% | 10.40% |
Maximum | Discount rates | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Loans at Fair vlaue | 20% | 36% |
Payable to investors at fair value | 8.30% | 8.60% |
Maximum | Net cumulative expected loss rates | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Loans at Fair vlaue | 8.30% | 12.10% |
Maximum | Cumulative prepayment rates | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Loans at Fair vlaue | 18.20% | 18.30% |
FAIR VALUE OF ASSETS AND LIAB_6
FAIR VALUE OF ASSETS AND LIABILITIES - Additional Information about Level 3 Loans and Payable to Investors (Details) - CNY (¥) ¥ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Loans At Fair Value | ||
Beginning balance | ¥ 54,049 | ¥ 73,734 |
Origination of loans | 1,494,096 | 56,147 |
Collection of principals | (772,398) | (92,673) |
Change in fair value | ¥ (97,912) | ¥ 16,841 |
Fair Value, Asset, Recurring Basis, Unobservable Input Reconciliation, Gain (Loss), Statement of Income or Comprehensive Income [Extensible Enumeration] | Fair Value, Assets Measured on Recurring Basis, Change in Unrealized Gain (Loss) | Fair Value, Assets Measured on Recurring Basis, Change in Unrealized Gain (Loss) |
Ending balance | ¥ 677,835 | ¥ 54,049 |
Payable to investors At Fair Value | ||
Beginning balance | 50,686 | |
Contribution from investors of the consolidated ABFE | 450,000 | |
Interest and penalties received | 58,481 | 11,249 |
Deductible expenses associated with the consolidated ABFE operation | (5,815) | (5,216) |
Principal and interest payments to investors of Consolidated ABFE | (7,770) | (92,480) |
Changes in fair value | (52,220) | (2,059) |
Amount due to related parties (i) | 3,086 | 37,820 |
Ending balance | 445,762 | |
Investors | ||
Payable to investors At Fair Value | ||
Amount due to related parties (i) | 1,517 | 4,603 |
ABFE | ||
Payable to investors At Fair Value | ||
Amount due to related parties (i) | ¥ 1,517 | ¥ 4,603 |
INVESTMENTS (Details)
INVESTMENTS (Details) ¥ in Thousands, $ in Thousands | 12 Months Ended | ||||
Dec. 31, 2023 CNY (¥) | Dec. 31, 2023 USD ($) | Dec. 31, 2022 CNY (¥) | Dec. 31, 2021 CNY (¥) | Dec. 31, 2023 USD ($) | |
Available-for-sale investments | |||||
Changes in fair value of the available-for-sale investments, net of tax | ¥ 17,813 | $ 2,509 | ¥ (12,351) | ¥ (2,362) | |
Fair value of trading securities | (4,479) | 0 | 0 | ||
Fair value | 438,084 | 972,738 | $ 61,703 | ||
Bank wealth management products | |||||
Available-for-sale investments | |||||
Cost | 127,000 | 888,828 | |||
Fair value | 127,000 | 888,828 | |||
Debt securities | |||||
Available-for-sale investments | |||||
Cost | 24,241 | 60,218 | |||
Unrealized gains in accumulated other comprehensive income | 5,253 | (10,154) | |||
Impact of exchange rate | 122 | (1,154) | |||
Fair value | 29,616 | 48,910 | |||
Available-for-sale investments | |||||
Available-for-sale investments | |||||
Interest income | 3,203 | 15,488 | 5,238 | ||
Impairment loss | 0 | 0 | 0 | ||
Changes in fair value of the available-for-sale investments, net of tax | 17,813 | (12,351) | (2,362) | ||
Non-marketable equity investments | |||||
Available-for-sale investments | |||||
Cost | 281,410 | 35,000 | |||
Unrealized gains in accumulated other comprehensive income | 2,406 | ||||
Impact of exchange rate | (2,348) | ||||
Fair value | 281,468 | 35,000 | |||
Held-to-maturity investments | |||||
Available-for-sale investments | |||||
Interest income | 21,294 | 1,458 | 2,963 | ||
Held-to-maturity investments, allowance for credit loss | ¥ 0 | ¥ 0 | ¥ 0 |
PROPERTY, EQUIPMENT AND SOFTW_3
PROPERTY, EQUIPMENT AND SOFTWARE, NET (Details) ¥ in Thousands, $ in Thousands | 12 Months Ended | ||||
Dec. 31, 2023 CNY (¥) | Dec. 31, 2023 USD ($) | Dec. 31, 2022 CNY (¥) | Dec. 31, 2021 CNY (¥) | Dec. 31, 2023 USD ($) | |
PROPERTY, EQUIPMENT AND SOFTWARE, NET | |||||
Total property, equipment and software | ¥ 127,867 | ¥ 120,167 | |||
Accumulated depreciation and amortization | 48,709 | 42,911 | |||
Property, equipment and software, net | 79,158 | 77,256 | $ 11,149 | ||
Depreciation and amortization expenses | 7,116 | $ 1,002 | 26,430 | ¥ 43,236 | |
Impairment losses of long-lived assets | 0 | 0 | ¥ 0 | ||
Building | |||||
PROPERTY, EQUIPMENT AND SOFTWARE, NET | |||||
Total property, equipment and software | 38,464 | 38,464 | |||
Computer and transmission equipment | |||||
PROPERTY, EQUIPMENT AND SOFTWARE, NET | |||||
Total property, equipment and software | 12,106 | 9,183 | |||
Furniture and office equipment | |||||
PROPERTY, EQUIPMENT AND SOFTWARE, NET | |||||
Total property, equipment and software | 493 | 460 | |||
Leasehold improvements | |||||
PROPERTY, EQUIPMENT AND SOFTWARE, NET | |||||
Total property, equipment and software | 4,019 | 4,178 | |||
Software | |||||
PROPERTY, EQUIPMENT AND SOFTWARE, NET | |||||
Total property, equipment and software | 39,795 | 39,392 | |||
Licenses | |||||
PROPERTY, EQUIPMENT AND SOFTWARE, NET | |||||
Total property, equipment and software | ¥ 32,990 | ¥ 28,490 |
ACCRUED EXPENSES AND OTHER LI_3
ACCRUED EXPENSES AND OTHER LIABILITIES (Details) ¥ in Thousands, $ in Thousands | Dec. 31, 2023 CNY (¥) | Dec. 31, 2023 USD ($) | Dec. 31, 2022 CNY (¥) |
ACCRUED EXPENSES AND OTHER LIABILITIES | |||
Tax payable | ¥ 931,191 | ¥ 562,839 | |
Accrued payroll and welfare | 153,554 | 403,104 | |
Payable to investors (i) | 145,655 | 147,864 | |
Accrued advertisement expenses | 134,601 | 58,707 | |
Guarantee liabilities | 37,153 | 51,766 | |
Funds collected on behalf of third-party guarantee companies | 11,387 | 18,766 | |
Accrued customer incentives | 3,263 | 5,024 | |
Others | 83,718 | 66,936 | |
Total accrued expenses and other liabilities | ¥ 1,500,522 | $ 211,344 | ¥ 1,315,006 |
RELATED PARTY BALANCES AND TR_3
RELATED PARTY BALANCES AND TRANSACTIONS (Details) ¥ in Thousands, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2023 CNY (¥) | Dec. 31, 2023 USD ($) | Dec. 31, 2022 CNY (¥) | Dec. 31, 2021 CNY (¥) | |
RELATED PARTY BALANCES AND TRANSACTIONS | ||||
Total costs and expenses | ¥ 396,913 | ¥ 450,985 | ¥ 491,651 | |
Net revenue | 4,895,633 | $ 689,535 | 3,434,620 | 4,477,929 |
Customers acquisition and referral services | ||||
RELATED PARTY BALANCES AND TRANSACTIONS | ||||
Total costs and expenses | ¥ 175,471 | ¥ 216,958 | ¥ 281,633 | |
Guarantee service charge rate (as a percent) | 18% | 18% | 20% | 0% |
Credit assessment services | ||||
RELATED PARTY BALANCES AND TRANSACTIONS | ||||
Total costs and expenses | ¥ 118,395 | ¥ 110,566 | ¥ 56,957 | |
System support services | ||||
RELATED PARTY BALANCES AND TRANSACTIONS | ||||
Total costs and expenses | 72,035 | 100,635 | 135,118 | |
Collection services | ||||
RELATED PARTY BALANCES AND TRANSACTIONS | ||||
Total costs and expenses | 29,188 | 22,735 | 17,943 | |
Others services | ||||
RELATED PARTY BALANCES AND TRANSACTIONS | ||||
Total costs and expenses | 1,824 | 91 | ||
Ruicheng | Customers acquisition and referral services | ||||
RELATED PARTY BALANCES AND TRANSACTIONS | ||||
Total costs and expenses | 175,824 | 155,093 | 0 | |
Related Party | ||||
RELATED PARTY BALANCES AND TRANSACTIONS | ||||
Net revenue | 141,595 | 411,010 | 573,158 | |
Related Party | Customers acquisition and referral services | ||||
RELATED PARTY BALANCES AND TRANSACTIONS | ||||
Net revenue | 140,782 | 409,688 | 442,570 | |
Related Party | Technical services | ||||
RELATED PARTY BALANCES AND TRANSACTIONS | ||||
Net revenue | 85,832 | |||
Related Party | Post-loan management services | ||||
RELATED PARTY BALANCES AND TRANSACTIONS | ||||
Net revenue | 44,586 | |||
Related Party | Others services | ||||
RELATED PARTY BALANCES AND TRANSACTIONS | ||||
Net revenue | ¥ 813 | ¥ 1,322 | ¥ 170 |
RELATED PARTY BALANCES AND TR_4
RELATED PARTY BALANCES AND TRANSACTIONS - Loans Collected and Received (Details) - CNY (¥) ¥ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Related Party Transaction [Line Items] | |||
Loans collected from/(issued to) CreditEase, its subsidiaries and affiliates recorded in investing activities | ¥ (200,000) | ||
Loans received from/(repaid to) CreditEase, its subsidiaries and affiliates recorded in financing activities | ¥ (195,800) | (182,000) | ¥ (26,700) |
Amounts due from related parties | 820,181 | 1,266,232 | |
Amounts due to related parties | 14,414 | 227,724 | |
Interest expenses | 13,116 | 27,866 | 31,411 |
Interest income | 6,937 | 3,774 | 0 |
Zhuoyue | |||
Related Party Transaction [Line Items] | |||
Amounts due from related parties | 310,354 | 549,699 | |
Hengda Hongyuan | |||
Related Party Transaction [Line Items] | |||
Loans received from/(repaid to) CreditEase, its subsidiaries and affiliates recorded in financing activities | (195,800) | (139,000) | ¥ (26,700) |
Amounts due to related parties | 198,045 | ||
Pucheng Credit | |||
Related Party Transaction [Line Items] | |||
Loans collected from/(issued to) CreditEase, its subsidiaries and affiliates recorded in investing activities | (200,000) | ||
Amounts due from related parties | 203,353 | 204,000 | |
Amounts due to related parties | 9,084 | 12,162 | |
Puxin Hengye | |||
Related Party Transaction [Line Items] | |||
Amounts due from related parties | 139,071 | 195,406 | |
Huichuang | |||
Related Party Transaction [Line Items] | |||
Amounts due from related parties | 76,118 | 88,887 | |
Hainan CreditEase | |||
Related Party Transaction [Line Items] | |||
Amounts due from related parties | 26,073 | 20,259 | |
Hengcheng | |||
Related Party Transaction [Line Items] | |||
Amounts due from related parties | 172,103 | ||
Qichuang | |||
Related Party Transaction [Line Items] | |||
Loans received from/(repaid to) CreditEase, its subsidiaries and affiliates recorded in financing activities | (43,000) | ||
Zhicheng A'Fu | |||
Related Party Transaction [Line Items] | |||
Amounts due to related parties | 3,786 | 10,293 | |
Other related parties | |||
Related Party Transaction [Line Items] | |||
Amounts due from related parties | 65,212 | 35,878 | |
Amounts due to related parties | ¥ 1,544 | 7,224 | |
Haijin Yichuang | |||
Related Party Transaction [Line Items] | |||
Financing receivables was transferred to related party | ¥ 198,045 |
RELATED PARTY BALANCES AND TR_5
RELATED PARTY BALANCES AND TRANSACTIONS - Non-competition arrangement (Details) ¥ in Millions | Dec. 31, 2023 CNY (¥) |
Minimum | |
Non-competition agreement, investable financial assets | ¥ 1 |
Maximum | |
Non-competition agreement, investable financial assets | ¥ 10 |
SECURED BORROWINGS (Details)
SECURED BORROWINGS (Details) ¥ in Thousands, $ in Millions | 12 Months Ended | |||
Dec. 31, 2023 CNY (¥) | Dec. 31, 2022 CNY (¥) | Dec. 31, 2021 CNY (¥) | Dec. 31, 2023 USD ($) | |
Debt Instrument [Line Items] | ||||
Principal amount | $ | $ 0 | |||
Interest expenses | ¥ 39,000 | ¥ 109,200 | ¥ 109,800 | |
Principal balance of secured borrowing | 14,414 | 227,724 | ||
Secured borrowings is included in amount due to related parties | $ | $ 0 | |||
Secured borrowing | ¥ 0 | ¥ 767,900 | ||
Minimum | ||||
Debt Instrument [Line Items] | ||||
Interest rate related to borrowings | 7% | 7% | 7% | 7% |
Minimum | Yichuang Financial Leasing | ||||
Debt Instrument [Line Items] | ||||
Remaining lease terms | 1 year | 1 year | ||
Term of debt | 1 year | |||
Maximum | ||||
Debt Instrument [Line Items] | ||||
Interest rate related to borrowings | 11% | 11% | 11% | 11% |
Maximum | Yichuang Financial Leasing | ||||
Debt Instrument [Line Items] | ||||
Remaining lease terms | 3 years | 3 years | ||
Term of debt | 3 years | |||
Haijin Yichuang | ||||
Debt Instrument [Line Items] | ||||
Principal amount | ¥ 0 | ¥ 0 | ¥ 541,600 | |
Creditor's right of certain financial receivables transferred | ¥ 0 | ¥ 0 | ¥ 550,000 |
INCOME TAXES (Details)
INCOME TAXES (Details) ¥ in Thousands, $ in Millions | 12 Months Ended | |||||||||
Dec. 31, 2023 HKD ($) | Dec. 31, 2023 CNY (¥) | Dec. 31, 2022 CNY (¥) | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
INCOME TAXES | ||||||||||
Income tax rate | 25% | 25% | 25% | 25% | ||||||
Foreign invested enterprise tax withholding rate | 10% | 10% | ||||||||
Minimum threshold percentage of equity interest in PRC will be entitled to reduced withholding tax rate | 25% | 25% | ||||||||
Reduced withholding tax rate for qualified tax residents | 5% | 5% | ||||||||
Percentage of semi annual dividends | 15% | 15% | ||||||||
Undistributed earnings of the company's PRC subsidiaries and the consolidated VIEs | ¥ | ¥ 3,690,000 | ¥ 4,594,000 | ||||||||
Provision for PRC dividend withholding tax | ¥ | ¥ 0 | |||||||||
PRC | ||||||||||
INCOME TAXES | ||||||||||
Income tax rate | 25% | 25% | ||||||||
Preferential tax rate (as a percent) | 25% | 25% | ||||||||
Small low-profit enterprises | ||||||||||
INCOME TAXES | ||||||||||
Preferential tax rate (as a percent) | 5% | 5% | ||||||||
Yirendai HK | HONG KONG | Assessable profits up to HK$2 | ||||||||||
INCOME TAXES | ||||||||||
Foreign corporate income tax rate | 8.25% | 8.25% | ||||||||
Base Assessable Profits | $ | $ 2 | |||||||||
Yirendai HK | HONG KONG | Assessable profits over HK$2 | ||||||||||
INCOME TAXES | ||||||||||
Foreign corporate income tax rate | 16.50% | 16.50% | ||||||||
Base Assessable Profits | $ | $ 2 | |||||||||
YouRace Hengchuang | ||||||||||
INCOME TAXES | ||||||||||
Period of full exemption from income tax | 2 years | 2 years | ||||||||
Reduction in preferential tax rate during subsequent three years (as a percent) | 50% | 50% | 50% | |||||||
Period of 50% reduction to income tax rate | 3 years | 3 years | 3 years | |||||||
Preferential tax rate (as a percent) | 15% | 15% | ||||||||
Hengyuda, Hengfengyi and Jintong | ||||||||||
INCOME TAXES | ||||||||||
Preferential tax rate (as a percent) | 15% | 15% | ||||||||
Yiren Hengsheng | ||||||||||
INCOME TAXES | ||||||||||
Period of full exemption from income tax | 2 years | 2 years | ||||||||
Reduction in preferential tax rate during subsequent three years (as a percent) | 50% | 50% | 50% | |||||||
Period of 50% reduction to income tax rate | 3 years | 3 years | 3 years | |||||||
YouRace HK | ||||||||||
INCOME TAXES | ||||||||||
Foreign invested enterprise tax withholding rate | 10% | 10% |
INCOME TAXES - Schedule of Inco
INCOME TAXES - Schedule of Income Tax Expense (Details) ¥ in Thousands, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2023 CNY (¥) | Dec. 31, 2023 USD ($) | Dec. 31, 2022 CNY (¥) | Dec. 31, 2021 CNY (¥) | |
INCOME TAXES | ||||
Current tax | ¥ 512,054 | ¥ 410,106 | ¥ 85,198 | |
Deferred tax | 53,109 | (109,594) | 84,991 | |
Income tax expenses | ¥ 565,163 | $ 79,601 | ¥ 300,512 | ¥ 170,189 |
INCOME TAXES - Reconciliation o
INCOME TAXES - Reconciliation of the Statutory Income Tax Rate to Income Tax Expense (Details) ¥ in Thousands, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2023 CNY (¥) | Dec. 31, 2023 USD ($) | Dec. 31, 2022 CNY (¥) | Dec. 31, 2021 CNY (¥) | |
INCOME TAXES | ||||
Income before provision for income taxes | ¥ 2,645,360 | $ 372,591 | ¥ 1,495,383 | ¥ 1,203,173 |
Statutory tax rate in the PRC (as a percent) | 25% | 25% | 25% | 25% |
Income tax expenses at statutory tax rate | ¥ 661,340 | ¥ 373,846 | ¥ 300,793 | |
Non-deductible expenses | 365 | 12,663 | ||
Research and development super deduction | (11,620) | (5,697) | (8,508) | |
Effect of income not taxable | (58,359) | (29,398) | (24,604) | |
Effect of tax holiday and preferential tax rate | (108,806) | (45,074) | (132,485) | |
Adjustment on current income tax of the prior periods | 80 | (9,085) | (5,614) | |
Effect of different tax rates of subsidiaries operating in other jurisdictions | 26,793 | 5,731 | 28,072 | |
Withholding income tax | 40,000 | |||
Change in valuation allowance | 15,735 | 9,824 | (128) | |
Income tax expenses | ¥ 565,163 | $ 79,601 | ¥ 300,512 | ¥ 170,189 |
INCOME TAXES - Aggregate amount
INCOME TAXES - Aggregate amount and per share effect of the tax holiday and preferential tax rate (Details) - CNY (¥) ¥ / shares in Units, ¥ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Aggregate amount and per share effect of the tax holiday and preferential tax rate | |||
The aggregate amount of tax holiday and preferential tax rate | ¥ (108,806) | ¥ (45,074) | ¥ (132,485) |
The aggregate effect on basic and diluted net income per share: | |||
- Basic | ¥ (0.6156) | ¥ (0.2580) | ¥ (0.7838) |
- Diluted | ¥ (0.6089) | ¥ (0.2570) | ¥ (0.7766) |
INCOME TAXES - Schedule of Defe
INCOME TAXES - Schedule of Deferred Tax Assets (Details) - CNY (¥) ¥ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Deferred tax assets: | ||
Deferred revenue | ¥ 8,105 | ¥ 10,783 |
Accrued expenses and other liabilities | 11,181 | 15,402 |
Fair value changes | 17,350 | 17,556 |
Allowance for uncollectible receivables | 121,080 | 113,836 |
Advertising expenses in excess of deduction limit | 2,068 | |
Valuation allowance | (38,545) | (40,567) |
Total | 121,239 | 117,010 |
Deferred tax liabilities: | ||
Contract assets, net | 162,767 | 105,252 |
Contract cost | 10 | 188 |
Intangible assets | 7,123 | 7,123 |
Total | 169,900 | 112,563 |
Net deferred tax liabilities | (48,661) | |
Net deferred tax assets | 4,447 | |
Valuation allowance | ¥ 38,545 | 40,567 |
Foreign invested enterprise tax withholding rate | 10% | |
Minimum threshold percentage of equity interest in PRC will be entitled to reduced withholding tax rate | 25% | |
Reduced withholding tax rate for qualified tax residents | 5% | |
Percentage of semi annual dividends | 15% | |
Undistributed earnings of the company's PRC subsidiaries and the consolidated VIEs | ¥ 3,690,000 | ¥ 4,594,000 |
Provision for PRC dividend withholding tax | ¥ 0 |
SHARE-BASED COMPENSATION (Detai
SHARE-BASED COMPENSATION (Details) ¥ in Thousands | 12 Months Ended | |||||||||||||||
Jul. 01, 2023 $ / shares shares | Jan. 01, 2023 $ / shares shares | Jul. 01, 2022 $ / shares shares | Jan. 01, 2022 $ / shares shares | Jul. 01, 2021 $ / shares shares | Jun. 30, 2021 $ / shares shares | Dec. 31, 2020 $ / shares shares | Jun. 30, 2020 $ / shares shares | Jul. 01, 2019 $ / shares shares | Dec. 31, 2023 CNY (¥) shares | Dec. 31, 2023 $ / shares | Dec. 31, 2022 CNY (¥) shares | Dec. 31, 2022 $ / shares | Dec. 31, 2021 CNY (¥) shares | Jul. 01, 2017 shares | Sep. 30, 2015 shares | |
Nonemployees | ||||||||||||||||
SHARE-BASED COMPENSATION | ||||||||||||||||
Recognized deemed dividend | ¥ | ¥ 3,698 | ¥ 38,168 | ¥ 23,223 | |||||||||||||
Employees | General and administrative expenses | ||||||||||||||||
SHARE-BASED COMPENSATION | ||||||||||||||||
Recognized compensation expenses | ¥ | ¥ 6,752 | ¥ 22,135 | ¥ 19,089 | |||||||||||||
Employee and Non-employee RSUs | ||||||||||||||||
Number of Restricted Shares | ||||||||||||||||
Unvested at beginning of the period (in shares) | 3,203,830 | 2,639,196 | 3,203,830 | 2,639,196 | ||||||||||||
Granted (in shares) | 909,842 | 10,922,272 | ||||||||||||||
Vested (in shares) | (1,349,098) | (9,442,362) | ||||||||||||||
Forfeited (in shares) | (604,826) | (915,276) | ||||||||||||||
Unvested at end of the period (in shares) | 2,159,748 | 3,203,830 | 2,639,196 | |||||||||||||
Weighted-Average Grant-Date Fair Value | ||||||||||||||||
Unvested at beginning of the period (in dollars per share) | $ / shares | $ 1.48 | $ 3.18 | $ 1.48 | $ 3.18 | ||||||||||||
Granted (in dollars per share) | $ / shares | 0.90 | 0.89 | ||||||||||||||
Vested (in dollars per share) | $ / shares | 1.62 | 1.15 | ||||||||||||||
Forfeited (in dollars per share) | $ / shares | 1.42 | 2.74 | ||||||||||||||
Unvested at end of the period (in dollars per share) | $ / shares | $ 1.17 | $ 1.48 | ||||||||||||||
The 2015 Share Incentive Plan | Employee and Non-employee RSUs | ||||||||||||||||
SHARE-BASED COMPENSATION | ||||||||||||||||
Ordinary shares were reserved for issuance | 3,939,100 | |||||||||||||||
The 2017 Share Incentive Plan | Employee and Non-employee RSUs | ||||||||||||||||
SHARE-BASED COMPENSATION | ||||||||||||||||
Approximate percentage of vested shares | 20% | |||||||||||||||
Number of Restricted Shares | ||||||||||||||||
Granted (in shares) | 43,386 | |||||||||||||||
Weighted-Average Grant-Date Fair Value | ||||||||||||||||
Vested (in dollars per share) | $ / shares | $ 6.92 | |||||||||||||||
The 2017 Share Incentive Plan | Employee and Non-employee RSUs | Maximum | ||||||||||||||||
SHARE-BASED COMPENSATION | ||||||||||||||||
Ordinary shares were reserved for issuance | 6,060,900 | |||||||||||||||
Vesting period | 4 years | |||||||||||||||
The 2017 Share Incentive Plan | Employee and Non-employee RSUs | Directors and employee | ||||||||||||||||
Number of Restricted Shares | ||||||||||||||||
Granted (in shares) | 43,386 | |||||||||||||||
The 2020 Share Incentive Plan | Employee and Non-employee RSUs | ||||||||||||||||
SHARE-BASED COMPENSATION | ||||||||||||||||
Vesting period | 3 years | 3 years | ||||||||||||||
Approximate percentage of vested shares | 30.20% | 79.50% | 3.10% | 15.40% | ||||||||||||
Number of Restricted Shares | ||||||||||||||||
Granted (in shares) | 430,028 | 479,814 | 10,754,250 | 168,022 | 1,381,350 | 1,830,024 | 143,560 | 2,592,140 | ||||||||
Weighted-Average Grant-Date Fair Value | ||||||||||||||||
Granted (in dollars per share) | $ / shares | $ 1.14 | $ 0.69 | $ 0.88 | $ 1.43 | $ 2.79 | $ 3.01 | $ 1.67 | $ 2.07 | ||||||||
The 2020 Share Incentive Plan | Employee and Non-employee RSUs | Maximum | ||||||||||||||||
SHARE-BASED COMPENSATION | ||||||||||||||||
Ordinary shares were reserved for issuance | 18,560,000 | |||||||||||||||
Vesting period | 3 years | 3 years | 3 years | 3 years | 3 years | |||||||||||
The 2020 Share Incentive Plan | Employee and Non-employee RSUs | Nonemployees | Related Party | CreditEase and its consolidated subsidiaries and VIEs | ||||||||||||||||
Number of Restricted Shares | ||||||||||||||||
Granted (in shares) | 192,474 | 287,020 | 7,120,948 | 88,290 | 933,652 | 769,560 | 3,648 | 502,416 | ||||||||
The 2020 Share Incentive Plan | Employee and Non-employee RSUs | Directors and employee | ||||||||||||||||
Number of Restricted Shares | ||||||||||||||||
Granted (in shares) | 237,554 | 192,794 | 3,633,302 | 79,732 | 447,698 | 1,060,464 | 139,912 | 2,089,724 |
SHARE-BASED COMPENSATION Additi
SHARE-BASED COMPENSATION Additional information (Details) - CNY (¥) ¥ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Employees | |||
Additional information | |||
Unrecognized share-based compensation expenses | ¥ 3,554 | ||
Recording period for unrecognized deemed dividends | 1 year 1 month 6 days | ||
Employees | Related Party | CreditEase and its consolidated subsidiaries and VIEs | |||
Additional information | |||
Unrecognized deemed dividend | ¥ 2,257 | ||
Recording period for unrecognized deemed dividends | 1 year 1 month 6 days | ||
Employee and Non-employee RSUs | |||
Additional information | |||
Fair value of RSUs vested | ¥ 15,476 | ¥ 73,068 | ¥ 59,611 |
SHARE REPURCHASE PROGRAM (Detai
SHARE REPURCHASE PROGRAM (Details) - American depositary shares $ / shares in Units, ¥ in Thousands, $ in Thousands | 12 Months Ended | |||||
Dec. 31, 2023 CNY (¥) shares | Dec. 31, 2023 USD ($) $ / shares shares | Dec. 31, 2022 CNY (¥) shares | Dec. 31, 2022 USD ($) $ / shares shares | Sep. 30, 2022 USD ($) | Jun. 30, 2018 USD ($) | |
Authorized amount | $ | $ 20,000 | $ 20,000 | ||||
Shares repurchased during the year (in ADS shares) | shares | 2,609,949 | 2,609,949 | 430,260 | 430,260 | ||
Repurchase of shares cost | ¥ 48,117 | $ 6,777 | ¥ 3,837 | $ 556 | ||
Average price per share (in dollars per share) | $ / shares | $ 2.61 | $ 1.27 |
NET INCOME PER SHARE AND NET _3
NET INCOME PER SHARE AND NET INCOME ATTRIBUTABLE TO ORDINARY SHAREHOLDERS (Details) ¥ / shares in Units, $ / shares in Units, ¥ in Thousands, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2023 CNY (¥) ¥ / shares shares | Dec. 31, 2023 USD ($) $ / shares shares | Dec. 31, 2022 CNY (¥) ¥ / shares shares | Dec. 31, 2021 CNY (¥) ¥ / shares shares | |
Numerator: | ||||
Net income | ¥ 2,080,197 | $ 292,990 | ¥ 1,194,871 | ¥ 1,032,984 |
Denominator: | ||||
Weighted average number of ordinary shares outstanding, basic | 176,749,706 | 176,749,706 | 174,695,959 | 169,029,826 |
Plus incremental weighted average ordinary shares from assumed vesting of RSUs using the treasury stock method(i) | 1,938,613 | 1,938,613 | 695,373 | 1,560,377 |
Weighted average number of ordinary shares outstanding, diluted | 178,688,319 | 178,688,319 | 175,391,332 | 170,590,203 |
Basic net income per share | (per share) | ¥ 11.7692 | $ 1.6577 | ¥ 6.8397 | ¥ 6.1113 |
Diluted net income per share | (per share) | ¥ 11.6415 | $ 1.6397 | ¥ 6.8126 | ¥ 6.0554 |
LEASES - Lease Cost (Details)
LEASES - Lease Cost (Details) ¥ in Thousands, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 CNY (¥) | Dec. 31, 2022 CNY (¥) | Dec. 31, 2023 USD ($) | |
Summary of supplemental information, lease cost recognized and recorded in sales and marketing and general and administrative expenses in the consolidated statements of operations and supplemental cash information related to operating leases | |||
Operating lease ROU assets | ¥ 23,382 | ¥ 33,909 | $ 3,293 |
Operating lease liabilities | ¥ 23,648 | ¥ 35,229 | $ 3,331 |
Operating leases - Weighted average remaining lease term | 1 year 5 months 15 days | 2 years 1 month 9 days | 1 year 5 months 15 days |
Operating leases - Weighted average discount rate | 3.30% | 3.30% | 3.30% |
Operating lease cost | ¥ 19,209 | ¥ 27,715 | |
Short-term lease cost | 168 | 192 | |
Total | 19,377 | 27,907 | |
Operating cash flows for operating leases | 20,263 | 17,743 | |
Operating leases | ¥ 7,958 | ¥ 12,289 |
LEASES - Operating Lease Liabil
LEASES - Operating Lease Liabilities Payments Due (Details) ¥ in Thousands, $ in Thousands | Dec. 31, 2023 CNY (¥) | Dec. 31, 2023 USD ($) | Dec. 31, 2022 CNY (¥) |
Maturity of operating lease liabilities at the end of the year | |||
2023 | ¥ 17,945 | ||
2024 | ¥ 18,976 | 16,304 | |
2025 | 4,445 | 2,253 | |
2026 | 821 | ||
Subtotal | 24,242 | 36,502 | |
Less: imputed interest | 594 | 1,273 | |
Present value of operating lease liabilities | ¥ 23,648 | $ 3,331 | ¥ 35,229 |
SEGMENT INFORMATION (Details)
SEGMENT INFORMATION (Details) ¥ in Thousands, $ in Thousands | 9 Months Ended | 12 Months Ended | ||||
Dec. 31, 2019 segment | Dec. 31, 2023 CNY (¥) segment | Dec. 31, 2023 USD ($) segment | Dec. 31, 2022 CNY (¥) segment | Dec. 31, 2021 CNY (¥) segment | Dec. 31, 2020 segment | |
SEGMENT INFORMATION | ||||||
Number of reportable segments | segment | 3 | 3 | 3 | 3 | 3 | 3 |
Net revenue | ¥ 4,895,633 | $ 689,535 | ¥ 3,434,620 | ¥ 4,477,929 | ||
Other (expenses)/income | 50,578 | 7,124 | 23,519 | (84,160) | ||
Income before provision for income taxes | 2,645,360 | 372,591 | 1,495,383 | 1,203,173 | ||
Depreciation and amortization | 7,116 | $ 1,002 | 26,430 | 43,236 | ||
Operating segments | ||||||
SEGMENT INFORMATION | ||||||
Net revenue | 4,895,633 | 3,434,620 | 4,477,929 | |||
Income from operations: | 2,778,370 | 1,619,439 | 1,385,144 | |||
Unallocated expenses | (183,588) | (147,575) | (97,811) | |||
Other (expenses)/income | 50,578 | 23,519 | (84,160) | |||
Income before provision for income taxes | 2,645,360 | 1,495,383 | 1,203,173 | |||
Financial services business | ||||||
SEGMENT INFORMATION | ||||||
Net revenue | 2,515,119 | 1,959,732 | 3,184,302 | |||
Depreciation and amortization | 1,019 | 19,032 | 29,225 | |||
Financial services business | Operating segments | ||||||
SEGMENT INFORMATION | ||||||
Net revenue | 2,515,119 | 1,959,732 | 3,184,302 | |||
Operating costs and expenses | (1,108,663) | (878,375) | (2,130,221) | |||
Income from operations: | 1,406,456 | 1,081,357 | 1,054,081 | |||
Insurance brokerage business | ||||||
SEGMENT INFORMATION | ||||||
Net revenue | 963,822 | 731,797 | 755,691 | |||
Depreciation and amortization | 101 | 135 | 94 | |||
Insurance brokerage business | Operating segments | ||||||
SEGMENT INFORMATION | ||||||
Net revenue | 963,822 | 731,797 | 755,691 | |||
Operating costs and expenses | (724,652) | (566,538) | (556,111) | |||
Income from operations: | 239,170 | 165,259 | 199,580 | |||
Consumption & lifestyle business and other | ||||||
SEGMENT INFORMATION | ||||||
Net revenue | 1,416,692 | 743,091 | 537,936 | |||
Depreciation and amortization | 1,506 | 1,774 | 1,308 | |||
Consumption & lifestyle business and other | Operating segments | ||||||
SEGMENT INFORMATION | ||||||
Net revenue | 1,416,692 | 743,091 | 537,936 | |||
Operating costs and expenses | (283,948) | (370,268) | (406,453) | |||
Income from operations: | ¥ 1,132,744 | ¥ 372,823 | ¥ 131,483 |
EMPLOYEE BENEFIT PLAN (Details)
EMPLOYEE BENEFIT PLAN (Details) - CNY (¥) ¥ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
EMPLOYEE BENEFIT PLAN | |||
Contribution for employee benefits | ¥ 68,192 | ¥ 89,682 | ¥ 182,154 |
STATUTORY RESERVES AND RESTRI_2
STATUTORY RESERVES AND RESTRICTED NET ASSETS (Details) - CNY (¥) ¥ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
STATUTORY RESERVES AND RESTRICTED NET ASSETS | |||
Required minimum percentage of appropriations | 10% | ||
Statutory threshold percentage of the reserve fund to the registered capital of the respective company, above which the appropriation is not required | 50% | ||
Appropriations to the enterprise expansion reserve and staff welfare and bonus reserve | ¥ 0 | ¥ 0 | ¥ 0 |
Amount of net assets of the relevant entity in the Group not available for distribution | 7,067,300 | 8,175,271 | |
Statutory reserve fund | ¥ 497,826 | ¥ 496,460 |
SUBSEQUENT EVENTS (Details)
SUBSEQUENT EVENTS (Details) ¥ in Thousands, $ in Millions | 12 Months Ended | 16 Months Ended | ||
Dec. 31, 2023 CNY (¥) | Dec. 31, 2022 CNY (¥) | Dec. 31, 2021 CNY (¥) | May 14, 2024 USD ($) shares | |
SUBSEQUENT EVENTS | ||||
Repurchase of share | ¥ | ¥ 48,117 | ¥ 3,837 | ¥ 2,750 | |
American depositary shares | ||||
SUBSEQUENT EVENTS | ||||
Share repurchased | shares | 4,037,741 | |||
Share repurchase value | $ | $ 12.1 | |||
Repurchase of ordinary shares (in shares) | shares | 3,607,481 | |||
Repurchase of share | $ | $ 11.5 |
SCHEDULE I-CONDENSED BALANCE SH
SCHEDULE I-CONDENSED BALANCE SHEETS (Details) $ / shares in Units, ¥ in Thousands, $ in Thousands | Dec. 31, 2023 CNY (¥) shares | Dec. 31, 2023 USD ($) $ / shares shares | Dec. 31, 2022 CNY (¥) shares | Dec. 31, 2022 $ / shares | Dec. 31, 2021 CNY (¥) | Dec. 31, 2020 CNY (¥) |
Assets | ||||||
Cash and cash equivalents | ¥ 5,791,333 | $ 815,692 | ¥ 4,271,899 | ¥ 2,864,543 | ||
Prepaid expenses and other assets | 426,511 | 60,073 | 321,411 | |||
Available-for-sale investments | 438,084 | 61,703 | 972,738 | |||
Total assets | 10,276,916 | 1,447,473 | 8,536,095 | |||
Liabilities | ||||||
Accrued expenses and other liabilities | 1,500,522 | 211,344 | 1,315,006 | |||
Total liabilities | 2,191,367 | 308,648 | 2,505,282 | |||
Equity: | ||||||
Ordinary shares (US$0.0001 par value; 500,000,000 shares authorized; 199,299,342 and 200,648,440 shares issued as of December 31, 2022 and 2023, respectively; 178,577,768 and 174,706,968 shares outstanding as of December 31, 2022 and 2023, respectively) | 130 | 18 | 129 | |||
Treasury stock (2,161,574 and 7,381,472 shares as of December 31, 2022 and 2023, respectively) | (94,851) | (13,359) | (46,734) | |||
Additional paid-in capital | 5,171,232 | 728,353 | 5,160,783 | |||
Accumulated other comprehensive income | 23,669 | 3,333 | 7,765 | |||
Retained earnings | 2,985,369 | 420,480 | 908,870 | |||
Total equity | 8,085,549 | 1,138,825 | 6,030,813 | ¥ 4,821,432 | ¥ 3,777,664 | |
Total liabilities and equity | ¥ 10,276,916 | $ 1,447,473 | ¥ 8,536,095 | |||
Ordinary shares, par value (in dollars per share) | $ / shares | $ 0.0001 | $ 0.0001 | ||||
Ordinary shares, authorized (in shares) | 500,000,000 | 500,000,000 | 500,000,000 | |||
Ordinary shares, issued (in shares) | 200,648,440 | 200,648,440 | 199,299,342 | |||
Ordinary shares, outstanding (in shares) | 174,706,968 | 174,706,968 | 178,577,768 | |||
Treasury stock, issued (in shares) | 7,381,472 | 7,381,472 | 2,161,574 | |||
Related Party | ||||||
Assets | ||||||
Amounts due from its subsidiaries and the consolidated VIEs | ¥ 820,181 | $ 115,520 | ¥ 1,266,232 | |||
Reportable Legal Entities | Parent Company | ||||||
Assets | ||||||
Cash and cash equivalents | 23,160 | 3,262 | 23,974 | |||
Prepaid expenses and other assets | ¥ | 2,411 | |||||
Amounts due from its subsidiaries and the consolidated VIEs | 1,350,493 | 190,213 | 1,397,591 | |||
Available-for-sale investments | 29,615 | 4,171 | 48,911 | |||
Investments in its subsidiaries and the consolidated VIEs | 6,689,748 | 942,231 | 4,572,152 | |||
Total assets | 8,093,016 | 1,139,877 | 6,045,039 | |||
Liabilities | ||||||
Accrued expenses and other liabilities | 7,467 | 1,052 | 14,226 | |||
Total liabilities | 7,467 | 1,052 | 14,226 | |||
Equity: | ||||||
Ordinary shares (US$0.0001 par value; 500,000,000 shares authorized; 199,299,342 and 200,648,440 shares issued as of December 31, 2022 and 2023, respectively; 178,577,768 and 174,706,968 shares outstanding as of December 31, 2022 and 2023, respectively) | 130 | 18 | 129 | |||
Treasury stock (2,161,574 and 7,381,472 shares as of December 31, 2022 and 2023, respectively) | (94,851) | (13,359) | (46,734) | |||
Additional paid-in capital | 5,171,232 | 728,353 | 5,160,783 | |||
Accumulated other comprehensive income | 23,669 | 3,333 | 7,765 | |||
Retained earnings | 2,985,369 | 420,480 | 908,870 | |||
Total equity | 8,085,549 | 1,138,825 | 6,030,813 | |||
Total liabilities and equity | ¥ 8,093,016 | $ 1,139,877 | ¥ 6,045,039 | |||
Ordinary shares, par value (in dollars per share) | $ / shares | $ 0.0001 | $ 0.0001 | ||||
Ordinary shares, authorized (in shares) | 500,000,000 | 500,000,000 | 500,000,000 | |||
Ordinary shares, issued (in shares) | 200,648,440 | 200,648,440 | 199,299,342 | |||
Ordinary shares, outstanding (in shares) | 174,706,968 | 174,706,968 | 178,577,768 | |||
Treasury stock, issued (in shares) | 7,381,472 | 7,381,472 | 2,161,574 |
SCHEDULE I-CONDENSED STATEMENTS
SCHEDULE I-CONDENSED STATEMENTS OF OPERATIONS (Details) ¥ in Thousands, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2023 CNY (¥) | Dec. 31, 2023 USD ($) | Dec. 31, 2022 CNY (¥) | Dec. 31, 2021 CNY (¥) | |
SCHEDULE I-CONDENSED STATEMENTS OF OPERATIONS | ||||
Net income | ¥ 2,080,197 | $ 292,990 | ¥ 1,194,871 | ¥ 1,032,984 |
Reportable Legal Entities | Parent Company | ||||
SCHEDULE I-CONDENSED STATEMENTS OF OPERATIONS | ||||
Operating expenses | (27,675) | (3,898) | (44,655) | (39,311) |
Interest income/(expenses) | (12,982) | (1,829) | 1,833 | 2,399 |
Non-operating (expense)/income , net | 1,178 | 166 | (39) | (1) |
Share of income of its subsidiaries and the consolidated VIEs | 2,119,676 | 298,551 | 1,237,732 | 1,069,897 |
Net income | ¥ 2,080,197 | $ 292,990 | ¥ 1,194,871 | ¥ 1,032,984 |
SCHEDULE I-CONDENSED STATEMEN_2
SCHEDULE I-CONDENSED STATEMENTS OF COMPREHENSIVE INCOME (Details) ¥ in Thousands, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2023 CNY (¥) | Dec. 31, 2023 USD ($) | Dec. 31, 2022 CNY (¥) | Dec. 31, 2021 CNY (¥) | |
SCHEDULE I-CONDENSED STATEMENTS OF COMPREHENSIVE INCOME | ||||
Net income | ¥ 2,080,197 | $ 292,990 | ¥ 1,194,871 | ¥ 1,032,984 |
Other comprehensive (loss)/income, net of tax of nil: | ||||
Foreign currency translation adjustment | (1,909) | (269) | 8,563 | (3,193) |
Unrealized (loss)/gain on available-for-sale investments | 17,813 | 2,509 | (12,351) | (2,362) |
Comprehensive income | 2,096,101 | 295,230 | 1,191,083 | 1,027,429 |
Other comprehensive (loss)/income, tax | 0 | 0 | 0 | |
Reportable Legal Entities | Parent Company | ||||
SCHEDULE I-CONDENSED STATEMENTS OF COMPREHENSIVE INCOME | ||||
Net income | 2,080,197 | 292,990 | 1,194,871 | 1,032,984 |
Other comprehensive (loss)/income, net of tax of nil: | ||||
Foreign currency translation adjustment | (1,909) | (269) | 8,563 | (3,193) |
Unrealized (loss)/gain on available-for-sale investments | 17,813 | 2,509 | (12,351) | (2,362) |
Comprehensive income | 2,096,101 | $ 295,230 | 1,191,083 | 1,027,429 |
Other comprehensive (loss)/income, tax | ¥ 0 | ¥ 0 | ¥ 0 |
SCHEDULE I-CONDENSED STATEMEN_3
SCHEDULE I-CONDENSED STATEMENTS OF CASH FLOWS (Details) ¥ in Thousands, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2023 CNY (¥) | Dec. 31, 2023 USD ($) | Dec. 31, 2022 CNY (¥) | Dec. 31, 2021 CNY (¥) | |
Cash Flows from Operating Activities: | ||||
Net cash provided by/(used in) operating activities | ¥ 2,171,013 | $ 305,780 | ¥ 1,849,430 | ¥ 158,192 |
Cash Flows from Investing Activities: | ||||
Purchase of available-for-sale investments | (3,386,062) | (476,917) | (2,056,000) | (341,234) |
Proceeds on disposal of available-for-sale investments | 3,926,509 | 553,037 | 1,254,285 | 334,942 |
Net cash (used in)/provided by investing activities | 100,045 | 14,091 | 52,559 | (346,507) |
Cash Flows from Financing Activities: | ||||
Repurchase of ordinary shares | (48,117) | (6,777) | (3,837) | (2,750) |
Net cash provided by/(used in) financing activities | (569,278) | (80,181) | (489,123) | 427,446 |
Effect of foreign exchange rate changes | (3,871) | (545) | 2,486 | (936) |
Net increase/(decrease) in cash and cash equivalents | 1,697,909 | 239,145 | 1,415,352 | 238,195 |
Cash, cash equivalents and restricted cash, beginning of year | 4,360,695 | 614,191 | 2,945,343 | 2,707,148 |
Cash, cash equivalents and restricted cash, end of year | 6,058,604 | 853,336 | 4,360,695 | 2,945,343 |
Reportable Legal Entities | Parent Company | ||||
Cash Flows from Operating Activities: | ||||
Net cash provided by/(used in) operating activities | (25,459) | (3,586) | (22,907) | (10,040) |
Cash Flows from Investing Activities: | ||||
Amounts due from/to its subsidiaries, the consolidated VIEs and related parties | 49,654 | 6,993 | 9,766 | (11,879) |
Purchase of available-for-sale investments | (34,234) | |||
Proceeds on disposal of available-for-sale investments | 22,682 | 3,195 | 33,215 | 14,942 |
Net cash (used in)/provided by investing activities | 72,336 | 10,188 | 42,981 | (31,171) |
Cash Flows from Financing Activities: | ||||
Repurchase of ordinary shares | (48,117) | (6,777) | (3,837) | (2,750) |
Net cash provided by/(used in) financing activities | (48,117) | (6,777) | (3,837) | (2,750) |
Effect of foreign exchange rate changes | 426 | 60 | 1,273 | (588) |
Net increase/(decrease) in cash and cash equivalents | (814) | (115) | 17,510 | (44,549) |
Cash, cash equivalents and restricted cash, beginning of year | 23,974 | 3,377 | 6,464 | 51,013 |
Cash, cash equivalents and restricted cash, end of year | ¥ 23,160 | $ 3,262 | ¥ 23,974 | ¥ 6,464 |