Lufax
2015195049 Geun Ho Ahn
Table of Contents
Part 1 : Overview Part 2 : Analysis
1. Industry Overview 1. Industry Analysis
2. Introduction to Lufax 2. Business Model Canvas
Part 3 : Evaluation Part 4 : Problem Identification &
Suggestion
1. SWOT Analysis
1. Industry Overview
2. Introduction to Lufax
01 Overview
Fintech Industry
● The term ‘fintech’ was coined in the early 1990s by
a project initiated by Citigroup.
● The industry started to take shape around 2014,
focusing on regulators, consumers and investors.
● Although relatively new, the industry is divided
into a few phases: and we are currently at Fintech
3.0 & 3.5.
● The industry enjoyed a boom since the launch of
the iPhone and Wealthfront at 2007 and 2008.
Traditional Typology
Typology in 2020
01 Lufax
Corporate Timeline
Listed on NYSE
2011 Lufax launched 2019 under the
LU.com symbol LU
Launched by 2015 Due to 2020
Ping An regulations on
Insurance Group P2P, transformed
to a Fintech
Company
What services do they
provide?
• Lufax is a technology-empowered personal
financial services platform based in China.
• Provide mainly three ’Products’ : Wealth
Management, Retail credit facilitation and
technology empowerment.
• Have been integrating AI, Data science and
Blockchain Utilization with their services,
providing targeted, intelligent and convenient
financial services.
Lufax’s Technology
Lufax’s Business Model
Lufax’s strategy
02 Analysis
Industry Analysis
Industry Analysis
Industry Analysis
39% 542 $7.2B
Quarter-over- Projected number of Funding to NA-
Quarter growth in Fintech deals in Q1 based Fintech firms,
global fintech of 2021 comapred to 2.9B
funding in Q1 of 2021. and 2.6B in Europe
and Asia.
China’s Fintech Industry
How is Lufax Performing?
46.5M
16.9%
Registered users
using wealth
management
service
Increase in total
12.9M income
compared to
Cumulative 2020.
number of
borrowers
Business Model Canvas
Business Model Canvas – Value Propositions
• Lufax enables online loans in 20 minutes, and the
user will be able to save time and money
• As they started as a P2P lender, they have
cumulated know-how on money-lending
business.
• Lufax and Ping an have been focusing heavily on
their app’s UX/UI and providing a ‘one-stop
service’ to increase convenience
Business Model Canvas – Revenue Streams
• Lufax’s revenue is generated by matching
institutional investors with borrowers / small
business owners
• More than 80% of Lufax’s revenue comes from
credit facilitation service fees, while wealth
management & service fees contribute about 5~6
percent annually.
• Investment Income accounts for 1.5~3 percent
annually.
03 Evaluation
SWOT : Strengths
• Strong brand awareness, first mover advantage
• Diverse Product Portfolio
• Large Database, easy user acquisition, access to
proprietary data and technology thanks to Ping
An
• Strong IP Portfolio
• Strong financial background
SWOT : Weaknesses
• Lufax’s business model has low ROI. Although
their balance sheet looks healthy, their company
is very asset-heavy
• Although it went public on the NYSE, their stock
price is struggling at 11.75 dollars due to the
skepticism towards digital lenders
• Inventory and cash cycle is not being managed
properly
SWOT : Opportunities
• Lufax has a high chance of further expanding
their business
• Rise of E-Commerce industry and online
consumption
• Could spot technological developments and
apply it to their business (i.e Blockchain, AI)
• China has a very good operating environment for
Fintech companies considering its consumers
SWOT : Threats
• Money-lending business and Fintech firms could
be heavily affected by government regulations (i.e
China’s regulation on P2P)
• With the rise of E-Commerce firms, barriers to
entry could get lower
• Rising packaging / logistics costs
• Bargaining power of buyers go up as Fintech
industry grows and people get used to it
Problem &
04 Recommendation
Problem 1 : High bargaining power of
customers, low customer loyalty
• Many firms offering many different
services in Fintech ecosystem
• No transaction costs occur when a
customer shifts to another firm /
service
• Difficult for fintech firms to
differentiate themselves
Recommendation 1.1 : Strengthening their
ties with Ping An
• Gigantic insurance group with
67.27 million active users and 2.95
million paid users monthly.
• Integrate Ping An’s mobile
insurance service with existing
services to further lure in
customers and obtain loyal
customers
• Take advantage of Ping An’s
network with other financial /
technology firms
Recommendation 1.2 : Personalized
services through AI / Technology
• Full-utilization of Lufax’s
technological capabilities
• Provide customized and modular
solutions to financial Institutions
• Strengthen data security to further
differentiate themselves
• Leverage analytics and insights
from Ping An
Problem 2 : Regulations and
underperformance in US
• Most digital lenders in US stock
exchange market have been
trading below their IPO prices
• Chinese government has almost
prohibited P2P business, American
government has also been posing
regulations to Fintech companies
Solution 2 : Regulations and
underperformance in US
• LU Global, operating in HK and
Singapore
• Following the trails of Ant financial,
IPO in HKSE could be beneficial for
the firm as the ecosystem is better
• To be free from regulations, they
could more emphasis on asset
management / retail credit
facilitation and Technology
development
Solution 2 : Partnerships with E-Commerce
companies
• Fintech companies could make
strategic partnerships with E-
Commerce companies in the US
and be stress-free about
regulations
• Offer their technological capacities
to E-Commerce giants such as
Amazon, further automatizing
payment methods
Thanks!
This could be the part of the presentation
where you can introduce yourself, write
your email...
