China’s housing rental market is sizzling hot. Alipay has a game plan for the rental market.
By Chloe Ter
China’s e-commerce giant Alibaba has signed an agreement with the Zhejiang provincial government to provide an online platform for residential rentals. This would be the country’s first intelligent rental platform.
On 10 October 2017, Alipay launched this rental platform with more than one million apartments made available on Alipay. On its launch, the platform will cover Shanghai, Beijing, Shenzhen, Hangzhou, Nanjing, Chengdu, Xi’an, and Zhengzhou. Alipay will power this rental service with the existing inhouse credit-scoring service, Sesame Credit.
Credit Score System to support the rental platform
Sesame Credit, a credit-scoring service attributes scores to Alipay users based on their creditworthiness. The credit score is based on the frequency of online purchases, punctuality in paying bills, and residential status. Today, credit score is used for visa applications, and even loans.
Alipay users with a credit score of at least 650 can rent houses with the Alipay app, pay their rent monthly without deposit. Under existing circumstances, tenants are expected to fork out three months’ rent upfront and pay one month’s rent as a deposit. Alipay will reduce the financial burden of tenants.
Tenants need not worry about common problems such as cheating agents and unfair landlords. Landlords will not need to worry about late rental payments. With Alibaba’s new solution, errant tenants and landlords will be penalized when they violate trust and rental rules. Alibaba can also impose travel bans in the worst case scenarios.
Online Contract Signing
Alibaba tenants will be able to sign contracts digitally. This process is more efficient than the current process – meeting physically to sign rental contracts.
Alipay is already an integral part of life for many Chinese people. This rental solution is a symbol of China’s Smart Nation ambition. In Asean, Singapore claims to be a Smart Nation. Perhaps there is still a lot for Singapore, a developed nation, to learn from China.