Navigating Turbulent Waters: Qfin Holdings Stays Afloat Amid Industry Volatility
According to Mr. Wu Haisheng, CEO of Qfin Holdings, China's consumer finance industry has remained under pressure since the start of 2026, with outstanding balances of short-term household loans falling by more than RMB 660 billion. Furthermore, regulatory measures have been introduced to promote a healthier and more compliant industry environment. However, an unexpected event in June triggered a crisis of confidence in the loan facilitation sector, causing liquidity to tighten sharply across the market.
Against this challenging backdrop, Qfin Holdings remained committed to its core values. By continuously optimizing user mix and business structure, the company enhanced operational efficiency and strengthened the resilience of its business model. As of the end of Q2, Qfin's AI-powered credit decision engine and asset distribution platform served 168 financial institutions, delivering intelligent digital credit services to over 65 million credit line users on a cumulative basis.
The company's risk management standards remained rigorous, while driving cost and efficiency improvements. In Q2, total loan facilitation and origination volume reached approximately RMB 63.4 billion, down 2.5% sequentially. Risk metrics continued to improve, accompanied by lower funding costs and greater operating efficiency. Amid the broad-based contraction in consumer credit supply, Qfin maintained a prudent balance across risk, scale, and profitability.
Risk management underpins every business decision made at Qfin Holdings, critical to navigating industry cycles and achieving sustainable growth. Since the second half of 2025, risk optimization has remained the top priority. By expanding its base of high-quality users and optimizing its business mix, Qfin kept the risk level of new loans at historical lows. In Q2, C-M2 ratio declined by 17% sequentially to 0.66%, approaching the level in Q2 last year.
Qfin further refined its pre-loan and in-loan risk strategies with closer monitoring of multiple borrowing and changes in customer liquidity. By analyzing multiple signals, including recent customer behavior, external borrowing exposure, and changes in debt levels, Qfin can quickly identify users with high debt burdens or declining income stability, allowing it to tighten risk strategies promptly and reduce exposure to high-risk segments.
For post-loan management, Qfin refined its Collection Scorecard, improving the ability to segment users by risk level, willingness to repay, and repayment capacity. The company then tailored its outreach strategies and offered targeted relief or repayment plans based on each customer's risk profile and actual ability to repay. These measures have improved the customer experience and made collection efforts more efficient.
As a result, Qfin's 30-day collection rate improved each month throughout Q2 and averaged 88.1%, up 2.3 percentage points sequentially. The company also embedded risk discipline earlier in the customer acquisition process, moderating the pace of acquisition spending and continuing to optimize its customer and loan mix. In doing so, Qfin has demonstrated its ability to navigate through turbulent waters, positioning itself for long-term success in the ever-evolving consumer finance industry.>
