By ZOU Luhui

In another attempt to challenge Alibaba’s dominance in e-commerce and fintech, Douyin, a short video platform owned by ByteDance, has launched a virtual credit card called “DOU Installment” as the company strives to become a one-stop shop for entertainment, shopping, and personal finance.

Customers of approved merchants can pay for their purchases in three, six, or twelve monthly installments if the total cost exceeds 200 yuan (US$30). Whether the buyer chooses to pay in installment or not, Douyin pays merchants upfront. The platform has taken measures to minimize and detect “manufactured purchases” to get cash upfront. Douyin is offering generous cash rebates and zero-interest to merchants and users alike.

“DOU Installment” trademark was registered in June last year and some of its features have been tried out in other personal finance products that are smaller in scope. In November 2020, the platform launched “Fangxinhua” (spend with assurance) with a small credit limit and no cash withdrawal allowance. It was essentially a financing option mainly used by content creators for payments on Douyin’s in-app features.

DOU Installment, in contrast, loops in hundreds of thousands of sellers, many selling through live streaming, and millions of buyers into its fast-growing fintech arm. This is no surprise, given the parent company’s e-commerce ambition. Since last year, in a series of organizational reshuffling, ByteDance, the parent company, had consolidated the e-commerce functions of its platforms by putting previously autonomous operations under a central business unit. Douyin recently stopped streamers selling on Alibaba or JD.com, forcing them to open shops directly on its own platform.

ByteDance sees potential in a strong fintech business and last year obtained licenses for mobile payments and online micro-lending and acquired a few small personal finance companies. DOU Installment may still seem quite basic compared to the all-encompassing Alipay, but the e-commerce war has certainly opened a new front in fintech.