On December 18, the company’s CEO released a letter offering an insightful perspective on Yiren Digital’s current position and long-term direction. In my view, it helps bring some much-needed clarity for investors regarding where the company stands today and where it’s heading. After reading it, these are the points I consider most relevant.
1. The “Cash Engines” (Cash Cows)
The CEO is very explicit here: domestic lending and online insurance are not just services — they are fuel.
Key point: The “traditional” businesses (loans and insurance) exist primarily to generate cash flow that will finance future expansion.
Strategic read: This confirms that YRD is consciously accepting regulatory and credit risk in China because margins and cash generation remain strong enough to fund entry into new markets. China is the cash machine.
2. International Expansion: Where Real Growth Lies
The letter confirms that operations outside China are growing significantly faster than the domestic business.
Key point: The goal is not simply to replicate the Chinese lending model abroad, but to go well beyond traditional financial services.
Strategic read: Viewed through a capital cycle lens, YRD is harvesting capital from a mature, highly competitive market (China) and redeploying it into earlier-stage markets in Southeast Asia, where returns on invested capital (ROIC) are likely higher.
3. FinTech 2.0: Blockchain and Crypto
The CEO openly frames blockchain as the future of financial services.
Key point: The move into crypto is not a side experiment — it’s positioned as part of the company’s next-generation vision. He emphasizes strict regulatory compliance (“highest compliance standards”).
Strategic read: This appears aimed at easing investor concerns around legality and regulatory risk. The message is clear: YRD will only operate in jurisdictions where digital assets are permitted. Personally, I don’t see limited crypto exposure as a negative in today’s environment — allocating some chips to digital assets no longer feels reckless.
4. Agentic AI: From Efficiency to Experience
Key point: Management believes they have “mastered” agentic AI. It is no longer viewed solely as a cost-cutting tool, but as a driver of a differentiated customer experience.
Strategic read: This helps justify ongoing tech investment. AI becomes the competitive moat that sustains user recurrence — currently around 65% — without relying on expensive marketing spend.
5. Resilience and Longevity
Tang highlights that Yiren Digital has survived over a decade as a public company, including COVID and multiple economic cycles.
Key point: The underlying message is simple: “We’re survivors.”
Strategic read: This reinforces the classic “cockroach thesis.” A management team that has navigated extreme volatility in China for over ten years has an intangible value that quantitative models often fail to capture.
Management Perspective: Vision 2026–2035
In his recent letter marking Yiren Digital’s 10th anniversary as a NYSE-listed company, CEO Ning Tang reaffirmed the firm’s transformation into a global “FinTech 2.0” platform. The strategy is straightforward: leverage strong cash generation from China’s lending and insurance businesses to fund expansion into high-growth areas such as blockchain-based finance and agentic AI.
With international expansion as a priority, YRD aims to diversify both geographic and regulatory risk. The ambition is not merely to survive the previous cycle, but to position the company as an architect of the next digital financial paradigm.
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