The transaction volume of second-hand cars in China is expected to hit 2 trillion yuan. (Photo : Getty Images)
Beijing-headquartered auto credit firm Meili Finance revealed on Wednesday that it has received an undisclosed amount of funding from JD Finance, the financial arm of Chinese online retailer JD.com, state-run Xinhua News Agency reported.
The funding marks JD.com's foray into auto finance, allowing the extension of its consumer credit business to the field, "which usually requires a license from the banking regulator," the article said.
Meili is reported to have delivered credit worth 250 million yuan to 30,000 auto buyers.
According to Xinhua, the firm has been exclusively working with the second-hand car sale company in the Chinese capital. Meili's business partner is said to be the largest in the country.
In a statement released by the company, Meili will get access to the risk control and credit checking expertise of JD Finance.
Back in November last year, the auto credit firm has also announced $65 million worth of investments from Bertelsmann Asia Investments, Morningside Ventures and Banyan Capital, among others.
Recent statistics show that in China, automobile ownership has already reached over 170 million units. Up in the game are second-hand autos whose sales are forecast to overtake new sales in the coming years. Their transaction volume is predicted to hit 2 trillion yuan.
With the surge of second-hand autos, more firms are venturing into the field and more investments are being poured to support this market segment.
A week earlier, online used-car market and 58.com-Ganji-backed Guazi.com announced that it has completed a $204-million funding round. Currently, the firm is valued at $1 billion.
Renrenche, another online used-car market, boasts about some leading Chinese companies as its backers. These include Tencent and smartphone maker Xiaomi's founder and CEO Lei Jun.
Launched in 2013, JD.com's financial arm is valued at approximately $7 billion.
