An implicit "sales-recycling" closed loop has quietly formed.
Following regulatory crackdowns on models that disguisedly push up interest rates through guarantees and rights, many loan facilitation platforms are pivoting towards "installment malls" as a new strategic direction. However, an investigation reveals that significant price premiums are prevalent on some platforms for product pricing, with consumers' actual payment costs far exceeding market levels.
Although most installment malls claim not to directly engage in recycling operations, user feedback indicates that third-party recyclers often proactively contact customers after purchases, offering instant cash-out services, thereby subtly creating a "sales-recycling" closed loop. Practical tests show that the comprehensive financing rate for users accessing funds through such channels can exceed 60%, with some platforms achieving gross profit margins above 90%.
Industry analysis points out that if such business is deemed "using consumption as a guise for lending activities," it not only risks regulatory suspension but could also lead to accountability for cooperating licensed institutions. Currently, some judicial rulings have partially invalidated high-premium installment models, and payment institutions are tightening cooperative channels. Striking a balance between creating genuine scenarios and maintaining compliance remains a Sword of Damocles hanging over the industry.
**The Rise of Installment Mall Business**
Several loan facilitation platforms have recently launched or expressed interest in entering the installment mall business. Platforms like Xiaoxiang Youpin, Yang Xiaomie, Tao Duoduo, and Lu Youxuan have drawn public attention due to concentrated consumer complaints.
Investigative testing found that best-selling items on these installment malls are predominantly high-liquidity goods like Apple phones, gold, and Moutai, with prices generally above market levels.
Taking Xiaoxiang Youpin as an example, the non-installment price for an iPhone 17 Pro Silver 1TB model is 17,000 yuan, while the total cost for a 6-month installment plan reaches 18,000 yuan. In contrast, the total price for the same product on a major e-commerce platform, even with installments, is only 14,000 yuan—a price difference exceeding 4,000 yuan.
Similar premium phenomena are widespread. For instance, a well-known liquor brand is priced at 1,569 yuan without installments on one platform, but costs 1,752 yuan for a 12-month plan. The same product sells for only 1,364 yuan at a leading e-commerce flagship store, which also offers interest-free installments, resulting in a price gap of approximately 200 to 400 yuan.
Installment prices on platforms like Yang Xiaomie and Tao Duoduo are also significantly higher than those on mainstream e-commerce sites. Some users reported using Yang Xiaomie's "Bianli Card Package" for a 6-month installment purchase of an item priced over 5,000 yuan, with the actual principal and interest totaling 5,673.90 yuan. Another consumer complained on a third-party complaint platform that after paying 5,257 yuan for a gold purchase on Tao Duoduo, the recycling payout was only 4,140 yuan.
A recycler revealed that prices for some platform goods can change before and after a user's credit limit assessment. For example, the price for a specific iPhone 16 256GB white model on one mall was displayed as over 6,000 yuan before assessment but increased to 8,227 yuan afterward. Further testing was not conducted as the assessment involves a credit inquiry.
Beyond product premiums, some platforms indirectly boost profits through membership services. Xiaoxiang Youpin, for instance, offers a "Plus Platinum Membership" costing around 40 yuan per month, which reduces certain service fees during installment purchases. Some users report difficulty finding the option to cancel such memberships, leading to ongoing charges without clear consent.
A market insider from the loan facilitation industry disclosed that against the backdrop of tightening regulation and pressure on traditional models, the installment mall business has become a key transformation direction for many institutions. Numerous platforms are actively studying the model's feasibility, with some already progressing to implementation stages involving system integration, supplier onboarding, and user experience optimization.
The source emphasized that compliance is a core consideration in current business design. "To meet regulatory requirements, platforms are particularly focused on ensuring reasonable product pricing during the design phase, striving for alignment with mainstream market prices while balancing product variety to avoid user complaints and regulatory scrutiny due to high prices or a narrow product range." The industry generally views "price transparency, comprehensive categories, and smooth experience" as foundational for sustainable development, though some smaller platforms might risk non-compliance for short-term profitability.
**Hidden Recycling Chains Drive Up Comprehensive Costs**
Previous reports highlighted models using leasing or installment plans for disguised lending and cash-outs. The newly emerging installment malls differ by being more cautious in compliance design, typically avoiding direct involvement in recycling. However, a more covert recycling chain is quietly forming, with multiple recyclers often contacting consumers post-transaction to offer cash-out channels.
Several users reported that after using the "Bianli Card Package" or shopping on Yang Xiaomie Mall, individuals or entities claiming to be "Yang Xiaomie cooperative merchants" quickly contacted them, offering to cash out their installment credit limits at rates typically 60-70% of the limit's value.
Some consumers stated they received such calls merely after browsing products within the relevant apps. These callers often specify recycling certain goods like branded phones or gold—items that retain value easily—and directly provide recycling and resale instructions.
A technology department staffer from a South China loan facilitation institution suggested this phenomenon indicates potential vulnerabilities in user information protection, even if platforms are not directly involved in recycling, leading to consumer privacy leakage to third-party recyclers and indirectly facilitating cash-out transactions.
Possibly due to recent increased media scrutiny, no recycling-related contacts were received after intensive browsing of various Yang Xiaomie products before publication.
Following user-provided leads, contact was made with a third-party recycler who stated they specialize in recycling goods from platforms like Tao Duoduo and Yang Xiaomie, with Tao Duoduo's buyback price being approximately 60% of the installment limit. The recycler required displaying the credit limit before purchase, specified a delivery address for the bought item, and promised instant cash-out where consumers handle no physical goods, with discounted funds transferred quickly.
During testing, the search bar on the Xiaoxiang Youpin platform featured "gold recycling" as a popular term. User-provided information indicated a 1-gram accessory on the platform supported 12-month repayments of 146.75 yuan per period, totaling 1,761 yuan, while the page's "one-click recycling" estimated price was only 985.27 yuan. However, attempts to access this recycling function repeatedly failed due to page lag and remained inaccessible at the time of writing.
Through these overt or covert recycling channels, consumers' actual comprehensive financing costs become substantial. For example, using an installment limit to purchase an item over 8,000 yuan on Tao Duoduo resulted in less than 5,000 yuan after recycling, equating to a comprehensive financing rate exceeding 60%.
A senior figure in the loan facilitation industry explained that the compliance of an installment mall hinges on whether it simultaneously acts as both seller and recycler. Combining these roles essentially constitutes disguised high-interest lending, unlikely to pass regulatory scrutiny. Therefore, the industry generally opts to clearly separate sales and recycling processes, sometimes even abandoning recycling operations altogether, sacrificing some profit for compliance leeway.
**How Institutions Profit**
The operators behind these emerging installment malls are often linked to loan facilitation businesses. Qichacha data shows that Xiaoxiang Youpin's operator, Wuxi Yuanshiyun Technology Co., Ltd., is a wholly-owned subsidiary of Yuanshiyun (Beijing) Technology Group Co., Ltd. Tao Duoduo is jointly operated by Shanghai Weiya Information Technology Co., Ltd., a financial industry membership rights service provider, and Beijing Baoyue Financing Guarantee Co., Ltd. Yang Xiaomie evolved from "Credit Wallet," a loan facilitation platform under QUANTGROUP.
Reflecting this background, some platforms feature prominent loan facilitation product entry points. For instance, logging into the Xiaoxiang Youpin app prompts users with interest-free installment coupons and guides them to "apply for a credit limit immediately, with fee reductions up to 1,000 yuan." Tao Duoduo directly promotes its "Taoxiang Card" credit limit application on its homepage.
What revenue can such businesses generate for related institutions? Financial data disclosed by QUANTGROUP, which listed on the Hong Kong Stock Exchange, may offer clues. After transitioning from loan facilitation to consumer e-commerce in 2020, the company's revenue grew from 475 million yuan in 2022 to 530 million yuan in 2023, then surged significantly to 993 million yuan in 2024. Revenue for the first five months of 2025 already reached 414 million yuan.
The Yang Xiaomie platform is the core driver of this revenue growth. According to the prospectus, Yang Xiaomie contributed approximately 93.2% and 98.1% of the group's total revenue in 2024 and the first five months of 2025, respectively.
The platform also maintains high gross profit margins: Yang Xiaomie's margins were 88.1%, 93.5%, and 97.5% for 2022, 2023, and 2024 respectively, reaching 96.7% in the first five months of 2025.
How does Yang Xiaomie achieve such high profitability? QUANTGROUP's prospectus explains that its income primarily comes from two sources: First, the price difference from self-operated merchandise sales. Yang Xiaomie's profit on each self-operated item is the difference between its selling price to end-users and its procurement cost from suppliers. Disclosed data shows this margin ratio ranges from 0% to 59.7%, with an average commission rate of 19.3% for the first five months of 2025. The platform states this range aligns with industry norms. However, an e-commerce industry insider noted that sales gross margins for e-commerce platforms typically range between 5% and 25%, varying by category. Competitive standardized products like 3C electronics and home appliances often have margins around 10%. Even for liquor, achieving such high levels is difficult without scarcity.
Second, commissions from third-party stores. For goods sold by third-party merchants on the platform, Yang Xiaomie charges a commission based on a percentage of the transaction value, usually between 1% and 5%.
An industry professional familiar with the business noted that on the supply side, platforms aggregate substantial user traffic with installment needs, creating stable sales expectations for suppliers. Consequently, suppliers are often willing to offer lower procurement prices in exchange for consistent, bulk sales channels, granting platforms significant cost advantages.
On the demand side, the embedded installment service itself constitutes a form of "financial convenience." For some consumers, immediate credit access and flexible payment plans lower the decision-making threshold for large purchases and reduce sensitivity to absolute product prices. Users effectively pay a premium for this "buy now, pay later" experience. "Given such significant price disparities," the source added, "it's likely that a portion of their user base consists of individuals seeking short-term liquidity through cash-outs, who exhibit higher price tolerance, further sustaining the high-premium model."
Attempts to contact QUANTGROUP for comment on these claims via their official phone line were unsuccessful before publication.
**Assessing the Risks**
Within the business logic of some installment malls, the high-premium product sales often conceal the true intent of certain customers: high-interest cash-outs.
Wang Pengbo, Chief Analyst at BoTong Consulting, stated that users being able to instantly recycle purchased goods for cash deviates from genuine consumption scenarios. From a fund flow perspective, users receive cash without handling physical goods, which is essentially closer to cash lending, merely cloaked in installment packaging. In the current regulatory environment emphasizing scenario authenticity, this model indeed operates in a gray area. The primary compliance risk isn't high product pricing per se, but being classified as using consumption as a front for lending activities. If deemed unlicensed lending or a disguised method to bypass interest rate caps, not only could the business be halted, but cooperating licensed institutions might also face repercussions.
As associated risks become more apparent, funding partners are adopting a more cautious approach, generally raising loan approval standards and strengthening risk control requirements for partner platforms and transaction scenarios. Concurrently, regulatory oversight is intensifying. Industry sources indicate that several payment institutions have initiated self-inspections and corrective actions, with some explicitly setting higher entry requirements for partners and beginning to narrow business scopes to mitigate potential compliance and operational risks.
Furthermore, judicial practice has started to challenge high-premium installment models. A review of court documents revealed a case where the Guizhou Province Xiuwen County People's Court ruled that a user purchasing an iPhone 16 Pro Max for 13,599 yuan—a device with a market value around 10,000 yuan—through a platform, was subject to the platform claiming default penalties at four times the Loan Prime Rate (LPR) after the user overdue. The court determined that the product price already exceeded market value, and claiming high penalties on top was unfair, ultimately only partially supporting the platform's claim.
An insider from the loan facilitation industry commented that extending service scenarios and building a consumption ecosystem through installment malls is a logically sound business approach. However, the key lies in compliance design: firstly, product pricing should roughly align with market levels, as significant premiums or direct sales of stored-value cards easily attract regulatory attention; secondly, platforms should avoid simultaneously acting as seller and recycler to prevent forming fund closed loops; thirdly, transaction authenticity must be ensured to guard against fictitious transactions and empty cash-out loops. Currently, many companies considering entry are actively exploring implementation plans that comply with regulatory requirements.
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