Qifu Technology, Inc. (QFIN) Stock Analysis

Qifu Technology (QFIN) possesses several durable competitive advantages in China’s credit-tech sector. First, its proprietary AI-driven risk management platform, the Argus Engine, enables superior credit assessment and fraud detection. Over 99% of loan applications are processed automatically, and the company maintains a 30-day collection rate of approximately 87%, which is at the high end of the industry.

Second, QFIN’s capital-light business model—whereby it facilitates loans for financial institutions rather than lending directly—limits balance sheet risk and supports high returns on equity (ROE: 30% in 2024). This model contrasts with traditional lenders and many fintech peers, such as LexinFintech and FinVolution, which retain more credit risk and typically report lower ROEs.

Third, QFIN’s scale and user engagement are notable. As of Q1 2025, it had 58.4 million users with approved credit lines and 163 financial institution partners. Repeat borrowers account for over 95% of loan volume, indicating strong customer retention and satisfaction.

Finally, QFIN’s aggressive share repurchase and dividend policy (2024 dividend payout ratio: 18%) enhances shareholder returns, a rarity among Chinese fintechs. While regulatory risk remains a sector-wide threat, QFIN’s compliance record and diversified funding base provide relative resilience. In sum, QFIN’s technology, scale, and capital efficiency underpin a competitive edge over both traditional banks and most fintech rivals.