Suning, the largest distributor of household appliances in China, Bank of Nanjing and BNP Paribas Personal Finance have decided to create a joint-venture dedicated to consumer credit at the point of sale for the 1,600 Suning stores in China, as well as for its on-line business.
The objective is to create a supplementary service for the 140 million Suning customers, in order to increase their satisfaction and loyalty, and thus encourage increased sales.
The three entities are the principal shareholders of the joint-venture (49% for Suning, 20% for Bank of Nanjing and 15% for BNP Paribas Personal Finance).
After presentation of the proposal for the joint-venture, the CBRC (China Banking Regulatory Commission) issued its approval on 12 December: the Consumer Finance Company Suning may officially begin its activity and should be operational by mid-2015.
Indeed, the company has six months from the date of license approval to complete the preparatory work under the supervision of the CRBC. At the end of this period, the company must conform to the provisions and procedures set forth by the CRBC. The offices of Suning will be located in Nanjing (province of Jiangsu) in China.
Alain van Groenendael, Deputy CEO of BNP Paribas Personal Finance, explains: "Our participation in this project is part of our development strategy in China. It shows the success of the partnership established with the Bank of Nanjing, which represents a true reference point in the Chinese market for us, and completes our expansion into this promising market after the agreement we reached last year with the Geely automobile manufacturing company. Ultimately, we are investing for the long term, since all of these new partnerships in China will bear fruit beyond the horizon of our Committed to 2016 plan, after 2019. "