Financing Receivables, Net

12 Months Ended

Dec. 31, 2021

Financing Receivable, after Allowance for Credit Loss [Abstract]

3. FINANCING RECEIVABLES, NET

Financing receivables, net as of December 31, 2020 and 2021 consisted of the followings:


	As of December 31,
	2020			2021
	(RMB in thousands)
Short-term:
Installment purchase loans		457,407			300,999
Personal installment loans		4,969,154			3,779,317
Total short-term financing receivables		5,426,561			4,080,316
Allowance for credit losses		(508,013	)		(307,341	)


Total short-term financing receivables, net	4,918,548		3,772,975
Long-term:
Installment purchase loans	127,265		93,754
Personal installment loans	98,645		166,896
Total long-term financing receivables	225,910		260,650
Allowance for credit losses	(21,149	)	(19,523	)
Total long-term financing receivables, net	204,761		241,127

These balances represent short‑term and long‑term financing receivables generated from installment purchase loans and personal installment loans transacted on the Group’s Platform and APP with an original term generally up to three years and do not have collateral. The weighted average interest rates of these financing receivables were 24.9% and 22.2% as of December 31, 2020 and 2021, respectively.

As of December 31, 2020, installment purchase loans and personal installment loans that were charged-off in accordance with the Group’s standard charge-off policy were RMB186.9 million and RMB2,802.9 million, respectively. As of December 31, 2021, installment purchase loans and personal installment loans that were charged-off in accordance with the Group’s standard charge-off policy were RMB201.4 million and RMB3,392.1 million, respectively. The Group determined it was probable that the Group will be unable to collect the unpaid principal amounts on those loans.

The following table summarizes the balances of financing receivables by due date as of December 31, 2020 and 2021:


	As of December 31,
	2020		2021
	(RMB in thousands)
Due in months
0 - 12		5,426,561		4,080,316
13 - 24		182,107		229,900
25 - 36		23,388		22,615
Thereafter		20,415		8,135
Total financing receivables		5,652,471		4,340,966

The activities in the allowance for credit losses of financing receivables for the years ended December 31, 2019, 2020 and 2021, respectively, consisted of the following:


	For the year ended December 31,
	2019			2020			2021
	(RMB in thousands)
Beginning balances		(384,036	)		(373,545	)		(529,162	)
Cumulative effect due to the adoption of ASC 326 (Note 2(g))		—			(229,661	)		—
Provision for credit losses		(708,684	)		(779,235	)		(401,417	)
Charge-offs		815,421			1,078,705			913,940
Recoveries from prior charge-offs		(96,246	)		(225,426	)		(310,225	)
Ending balances		(373,545	)		(529,162	)		(326,864	)

Aging analysis of past due financing receivables as of December 31, 2020 and 2021 are as follows:


RMB in thousands	1 - 29 Days Past Due		30 - 59 Days Past Due		60 - 89 Days Past Due		90 - 179 Days Past Due		180 Days or Greater Past Due		Total Past Due		Current		Total
Installment purchase loans		7,086		4,508		3,839		11,884		—		27,317		557,355		584,672
Personal installment loans		152,523		74,396		54,217		165,982		—		447,118		4,620,681		5,067,799
December 31, 2020		159,609		78,904		58,056		177,866		—		474,435		5,178,036		5,652,471
Installment purchase loans		6,965		3,763		2,698		5,784		-		19,210		375,543		394,753
Personal installment loans		132,538		35,583		26,405		70,910		-		265,436		3,680,777		3,946,213
December 31, 2021		139,503		39,346		29,103		76,694		-		284,646		4,056,320		4,340,966

Financing receivables amounting to RMB177.9 million and RMB76.7 million as of December 31, 2020 and 2021, respectively, were in non‑accrual status. Interest and financial services income for non‑accrual financing receivables is recognized on a cash basis. Cash receipt of non‑accrual financing receivables would be first applied to any unpaid principal, late payment fees, if any, before recognizing interest and financial services income. For the years ended December 31, 2019, 2020 and 2021, interest and late payment fees earned from non‑accrual financing receivables were RMB53.9 million, RMB78.8 million and RMB135.6 million, respectively.

As of December 31, 2020 and 2021, financing receivables amounting to RMB325.7 million and RMB1,193.0 million have been pledged as collaterals pursuant to investment agreements with certain Institutional Funding Partners (Note 10).

Credit Quality Indicators

The following table provides information on delinquency, which is the primary credit quality indicator for financing receivables. The amortized cost of installment purchase loans and personal installment loans within each credit quality indicator was presented by year of origination for five origination years and beyond, as of December 31, 2021:


	Loans originated in
RMB in thousands	1 - 29 Days Past Due		30 - 59 Days Past Due		60 - 89 Days Past Due		90 - 179 Days Past Due		180 Days or Greater Past Due		Total Past Due		Current		Total
Installment purchase loans
2017 and before		—		—		—		—		—		—		—		—
2018		2		5		5		33		—		45		1		46
2019		412		210		182		616		—		1,420		19,735		21,155
2020		1,519		855		816		2,445		—		5,635		72,540		78,175
2021		5,032		2,693		1,695		2,690		—		12,110		283,267		295,377
Total Installment purchase loans		6,965		3,763		2,698		5,784		—		19,210		375,543		394,753
Personal installment loans
2017 and before		—		—		—		—		—		—		—		—
2018		2		4		7		43		—		56		9		65
2019		757		365		295		1,177		—		2,594		23,504		26,098
2020		1,275		922		1,182		6,217		—		9,596		26,182		35,778
2021		130,504		34,292		24,921		63,473		—		253,190		3,631,082		3,884,272
Total Personal installment loans		132,538		35,583		26,405		70,910		—		265,436		3,680,777		3,946,213