Didi launches credit and insurance as new regulations threaten to reduce the number of drivers – TechCrunch • techcrunch.com


Didi Chuxing, The dominant Chinese company, which offers insurance and financing services, is deploying a range of financial and insurance services to strengthen its services in 2019.

The company announced today that it was adding insurance and credit "protection" services to passengers and drivers using its platform. The first is aimed particularly at Didi drivers by offering health and automobile insurance which, according to her, "will lower the barriers to workers entering the economy of immobility and broaden the scope of protection. to more families. "

These new options will appear in the Didi application. The company does not talk much about it in detail, but it was tested last year in 10 cities. Similar services have appeared in Southeast Asia, where Didi is allied Grab and its local rival, Go-Jek, have developed a range of fintech services, including payments and insurance.

It is impossible to ignore the fact that this new deployment of Didi intervenes in the midst of changes that could hinder its ability to attract and retain drivers. This is because, as we explained this weekRegulations that come into force on January 1 require drivers to hold two licenses, a local residence permit that authorizes them to work, and a license to use a vehicle for commercial purposes. This is tricky because the residence permit is hard to get, while the commercial driver's license adds a cost that may cause some part-time drivers to decide that driving with Didi has no financial meaning.

While Didi struggled to lower the barriers by allowing divers to rent licensed cars for themselves – "you supply the labor, we provide the car," says the slogan: these changes could spell the end of the great Chinese economy, at least in terms of the ride as we know it.

It is hard to criticize the introduction of stricter regulations for drivers, with two Didi passengers killed by their drivers last year. The company claims to have implemented a major restructuring This emphasizes passenger safety, but government intervention was inevitable and could mean a reduced driver pool. A Didi representative told TechCrunch that the company had 31 million pilots registered on the platform, but that the company did not indicate the number of its assets.

Nevertheless, for those who will continue with Didi or join his fleet in 2019, this new deployment aims to provide some of the financial services they lack by not working full-time "on a regular basis". In addition to insurance and loans, Didi will also offer "new energy vehicle" offers through its partners. This will cover both car buying, as well as leasing, trading and the acquisition of financing, explained the company.

For Didi, these introductions will probably provide a welcome boost. We know little about the finances of the company, but it's would have lost more than half a billion dollars in the first half of 2018, mainly on subsidies. Using its broad reach to help finance and distribution partners take ownership of its registered user base will create a new source of revenue while providing benefits to these users.

Government regulation is not the only challenge for Didi this year, as a number of rivals have multiplied even as Meituan – the company of "super applications" with deep pockets made public in 2018 decided to withdraw from the tour because of financial problems.

Traditional car giants BMW and SAIC engine – Volkswagen's partner in China – takes center stage while HelloBike, which has just won significant funding from Ant Financial and others, between too.

These factors make 2019 an interesting year for Didi. There was a lot of talk about the public introduction of society in previous years, but it seems that little progress has been made. Last year's split from its driver services business – a relatively heavy unit in assets – would have been a forerunner of a list, but already Lyft and Uber have taken their first steps and Didi reportedly blocked his efforts.