Yiren Digital (YRD) investor relations material

Business performance and AI integration

• Digital lending platform leverages 20 years of experience, serving over 100 million users, with 77% of loans in 2025 issued to repeat borrowers, indicating strong brand loyalty and risk management.

• AI-driven loan approval and risk mitigation reduced First Payment Default rate from 2.1% to 1.5%, with AI agents improving sales conversion and customer engagement.

• AI agents in debt collection increased productivity by 47%, reduced human involvement in first notice collections to less than 25%, and now handle more complex delinquency cases.

• AI-powered capital allocation improved accuracy by 10% to 66%, cut capital costs by 24 basis points, and reduced planning time from 100 hours to 20 minutes, enabling weekly reallocations.

• AI risk models use data from over 2,000 sources to classify borrowers into 10 risk classes, automating credit decisions and pricing, and improving recovery efficiency.

Insurance business and digital transformation

• Insurance brokerage operates nationwide with both online and offline channels, targeting young professionals with tailored healthcare products.

• Gross premium for internet insurance grew from CNY 4 million in Q1 2025 to CNY 50 million in Q4 2025, an 87% compound quarterly growth rate.

• Online channel expected to contribute 50% of insurance revenue by 2027, with cross-selling boosting offline high-margin products.

• AI innovation and operational efficiency remain strategic priorities, with plans to offer AI capabilities as a service and transition to an AI-native model.

Financial highlights and strategic outlook

• 2025 revenue was CNY 5.7 billion, down 1.5% due to intentional slowdown in loan facilitation during a credit down cycle; technology revenue share is rising.

• Cost of capital decreased by 110 basis points and customer acquisition costs by 80 basis points after new regulations reduced competition.

• Sales and marketing costs as a percentage of revenue dropped from 32% in 2024 to 21% in 2025, with AI driving efficiency and lower commissions.

• Shift to a risk-taking lending model led to upfront provisions but promises more predictable future revenue; ongoing monitoring of loan mix is planned.