Tencent, one of China’s largest internet companies, is looking to beef up its new banking affiliate by helping it raise $1bn in new capital, according to investors

Tencent, one of China’s largest internet companies, is looking to beef up its new banking affiliate by helping it raise $1bn in new capital, according to investors

The bolstering of Webank, which is 30 per cent owned by Tencent, is part of a government-approved push by China’s biggest internet conglomerates into finance — an area dominated by state-owned banks

Beijing hopes the push will lead to a rise in lending to small and medium-sized companies, which have been largely ignored by the state banking sector

The fundraising for Webank, which plans to offer small loans and other financial products to customers, is expected to value the company at $5bn. Tencent declined to comment on the capital raising

Tencent and other internet companies plan to use troves of internet “big data” to determine the creditworthiness of customers who might otherwise not have access to larger banks’ lending due to lack of collateral

The planned $1bn fundraising will help WeBank expand its personal-loan service called Weilidai — “a little loan” in English — which allows users to borrow up to Rmb200,000 without collateral