ChinaTravelNews - Didi Kuaidi announced on Tuesday that it has formed a strategic partnership with China Merchants Bank (CMB), one of China’s largest banks, enabling the 14 million Didi drivers to obtain loans from CMB for buying new cars through a range of financial services and O2O cooperation. CMB will also make a strategic investment of an undisclosed sum in Didi, joining a list of China’s big names, including the country’s sovereign wealth fund China Investment Corp (CIC), internet giants Alibaba, Tencent, Ping An Ventures and Beijing Automotive Group.
Liu Qing, president of Didi, said CMB would provide automobile financing to Didi drivers to buy new cars by installments. The loan terms and payment plans will be based on a joint review by both companies. The companies will also jointly launch credit and debit cards, and in-app card payments will also be added to the Didi app in the second quarter, adding to the current mobile payment services provided by Tencent’s WePay and Alibaba’s Alipay.
For Didi, the partnership with CMB brings extra capital, more financial asset management, an easier way for drivers to upgrade their vehicles, and integration of a new and convenient payment option, whereas for CMB, the partnership gives it a foothold in the online payment space currently dominated by Alipay and Wepay. Statistics from Big-Data Research show that over 90% of China's third-party mobile payment market, worth 9.3 trillion yuan ($1.41 trillion), is dominated by Alibaba and Tencent.
Didi received a total of US$3 billion funding last year. As reported by China Internet Network Information Center earlier this month, Didi holds 87.2% of China's private car hailing market. Didi boasts 250 million users in 400 cities in China, and said it has received 1.43 billion car-hailing requests in 2015, which means 1.43 billion yuan payments were made via smartphones.
Uber, Didi’s major rival, also announced on Tuesday that it would expand into 18 new cities across three provinces in South China by the end of next month. By then its service will cover a total of 55 cities.