W36 - Business Value of Quick Pay and Loan Payment

A new understanding of the business value of quick pay and loan payment for B-side clients.

From the B2B OKR perspective, there are two core metrics in total.

One is the capital closed-loop rate; the main implementation paths are balance payment, settlement-pending payment, and wealth-management fund payment. Its significance lies in the degree of consumption of settlement funds within the merchant system. By this logic, quick pay and loan payment do not contribute to the capital closed-loop rate.

The other metric is merchant financial service penetration rate; as a standard payment capability, quick pay can cover more business scenarios and a broader user base compared with other proprietary B-side payment methods. Users have better awareness of and higher acceptance of quick pay. Consequently, in early value estimates, quick pay was expected to contribute 1.82% to merchant penetration, accounting for more than half of the overall OKR. The overall OKR for B2B payments is 3%.

Quick pay and loan payment can also bring some direct business benefits; estimates indicate that in 2020 quick pay could save 2.39 million in channel fees, while loan payment could generate 2.56 million in interest income.

Finally, quick pay is highly significant for account retention; this aligns with the finance division’s LRP strategy centered on the account system: using high-frequency services to drive low-frequency ones, empowering B-side deposit and lending businesses.

The upcoming effort to build marketing capabilities will be the final push for the new payment capabilities this year to contribute to the two metrics above, and is crucial for achieving this year’s OKRs.