FinVolution Group Q4 FY2024 earnings call

Management Statement and Operational Highlights

• Growth: 2024 total transaction volume was RMB 206 billion (+6% YOY) and outstanding loan balance RMB 72 billion (+6% YOY). Total revenue RMB 30.1 billion (+4% YOY), with international revenue RMB 2.5 billion (+19% YOY, ~20% of total).
• Regulatory Licenses: Expanded regulatory licenses in key markets: China micro-lending, Indonesia multifinance, Pakistan nonbanking financial company.
• R&D and AI: Invested ~RMB 500 million in R&D in 2024, cumulative R&D over 5 years RMB 2.3 billion. Integrated DeepSeek R1 AI, AI-facilitated content reduced advertising costs by 60%, AI-powered customer service increased conversion rate by 9%, AI model for fraud detection 99% accurate.
• ESG and Inclusion: Empowered 826,000 small business owners with loans RMB 58 billion (+2% YOY), published first consumer protection annual report, borrower satisfaction rate 98.9%.

Segment Performance

• China: In Q4 2024, transaction volume reached RMB 54 billion (up 8% YOY) and outstanding loan balance was RMB 69.8 billion (up 6% YOY). Cumulatively, 26.8 million borrowers served in China, with 2.1 million unique borrowers in Q4. Day delinquency rate was 4.7%, loan collection recovery rate 89%, and expected vintage delinquency to improve to ~2.4%.
• International: Cumulatively served ~7 million borrowers in international markets, with 2.2 million new borrowers acquired in 2024 (+61% YOY). Full-year international transaction volume was RMB 10 billion (up 28% YOY) and outstanding loan balance RMB 1.7 billion (up 31% YOY). Q4 international transaction volume was RMB 2.9 billion (up 26% YOY, +7% QOQ). Full-year international revenue was RMB 2.5 billion (up 19% YOY, ~20% of total revenue), with Q4 international revenue RMB 739 million (up 23% YOY, ~21% of total). Indonesia saw 2024 full-year growth and acquired a multifinance license, while Philippines had 2024 transaction volume RMB 3.1 billion (up 138% YOY) with Buy Now, Pay Later model contributing 19% of volume.

Guidance

• 2025 revenue guidance: RMB 14.4 billion to RMB 15 billion, +10% to +15% YOY.
• Target to reach 50% revenue from international markets by 2030.
• 2025 dividend policy revised to 20%-30% of net income, Board approved share repurchase program up to USD 150 million.

Risks

• Macro economic uncertainties in China.
• Regulatory uncertainties in international markets.
• Risks associated with forward-looking statements, as results may differ materially.

Q: About international business operating cost base and expected growth/payout.

A: Jiayuan Xu discussed alignment with 2030 target, overseas costs vary by stage, profit contribution expected to rise.

Q: About shareholder return policy.

A: Jiayuan Xu explained dividend policy revision, share repurchase program, balance between growth and returns.

Q: About user demand recovery and domestic loan guidance.

A: Jiayuan Xu talked about Q4 recovery, 2025 optimism; Tiezheng Li discussed AI integration for efficiency and risk.

Q: About international expansion strategy.

A: Tiezheng Li discussed Indonesia, Philippines progress, Pakistan expansion plans.