Crowdfunding for a solar project? It’s not as far-fetched as it seems, going by the initiative of United Photovoltaics Group Ltd. (00686.HK).
Since Beijing gave a clear support signal for the solar industry last year, many companies have been rushing to set up new projects in China. But solar plants are costly investments, and banks are hesitant to lend to the sector given its notoriously volatile track record. So, what does United Photovoltaics, formerly known as GoldPoly New Energy, do in this situation? Well, it thinks out of the box and comes up with an internet financing strategy.
The move is probably inspired by the success of online investment fund products like Alibaba Group’s Yu’E Bao. In just about six months, Yu’E Bao had amassed 250 billion yuan and gained tens of millions of subscribers, making it seemingly easy to raise money through the internet.
United Photovoltaics will use the funds raised online to establish its first megawatt grade on-site solar project, in a venture located in the Qianhai new economic zone in Shenzhen.
To get “everyone to participate” as its slogan says, United Photovoltaics has assembled a strong team to ensure good credibility for its project. China Development Bank is on board; and major solar plant builder GD Solar, a regular project partner of United, is also there.
Stable long-term return and better air quality — one stone kills two birds, is United Photovoltaics’ marketing pitch.
The internet financing partner ncfgroup.com, which lists peer to peer lending as one of its pillar businesses, is not very well known. But that could change if the foray proves to be a success.
The venture definitely marks an interesting application of internet finance to serve the real economy.Observers will watch the initiative closely to see how successful it will be.
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