What’s new: Tencent-backed online bank WeBank will waive interest payments and extend the loan terms for more than 160,000 customers linked to its troubled business partner Danke Apartment, WeBank said Wednesday.
In the latest development in a high-profile crisis rattling the online rental giant, WeBank said the exemption will last at least until the end of 2023 for customers hoping to protect their interests in loan disputes with Danke.
There are 161,800 WeBank customers who took out loans for rental payments through Danke, according to WeBank. The bank earlier pledged to help Danke tenants resolve their debt disputes and said their credit scores would not be affected.
The background: WeBank is a rent-financing partner with Danke, which manages 415,000 flats across 13 big cities in China and is struggling with a funding shortfall of as much as 3 billion yuan ($457 million).
Under the partnership, when a tenant signs a lease with Danke, the tenant also signs a rental loan contract with WeBank to pay a full year’s rent in advance to Danke. Then the tenant makes monthly loan payments to WeBank.
However, money-losing Danke is accused of failing to make monthly and quarterly payments to the landlords from which it rents properties, even after it encouraged tenants to pay rent up-front using long-term loans from WeBank. That triggered hundreds of landlords and tenants to protest and demand overdue rent, refunds and compensation.
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Contact reporter Han Wei (weihan@caixin.com) and editor Bob Simison (bobsimison@caixin.com).
