Foxconn Technology Co Ltd is moving into finance by leveraging the big data boom in China.
Founder and Chairman Terry Gou said on Tuesday: "We are looking to offer financial services to our suppliers by taking advantage of the massive data we have collected over decades of manufacturing gadgets."
Calling this business model "supply chain finance", Gou said the company aims to help its suppliers make decisions, gather data and manage their cash flow.
"Big data can reveal whether suppliers are running out of steam. If they are, we can quickly see this and tell them to downsize inventory to help reduce costs."
Last year, Foxconn's transactions as both a vendor and purchaser amounted to $200 billion, and that activity yielded a vast collection of data.
"If our suppliers have good credit, we can provide financing to them at lower rates than banks charge," he said.
In 2013, the Taiwan-based company set up a financial unit in Shanghai to offer such services, but it is still in the process of applying for the necessary licenses.
Gou made the comments on a bus trip to his company's big data center in Guiyang, the capital of southwestern Guizhou province. In 2014, Foxconn signed a comprehensive partnership deal with Guizhou. The company, which churns out gadgets for Apple Inc, promised to set up big data centers and help develop Guizhou into an important handset manufacturing base by 2017.
In the first quarter of 2015, the industrial park built by Foxconn in Guiyang achieved a revenue of 227 million yuan ($37 million).
China Daily
