About AIFUL Group

Profit Structure of the AIFUL Group

The AIFUL Group is working to diversify its financial businesses and operates individual and small business loan businesses, credit card business, credit guarantee business, and overseas business. Thus, the Group seeks to diversify business risks as well as its revenue sources. With regard to costs, it strives to improve business efficiency by introducing BPR and RPA.

Operating revenue

Corresponds to net sales in other industries, such as manufacturing and retail.
Around 15% of operating revenue is earned from operating assets.

Income from interest on operating loans

Interest income gained from loan businesses in and outside Japan

Revenue from credit card

Fee income from the credit card business

Revenue from credit guarantee

Fee income from the credit guarantee business

Other revenue

Includes recoveries of written off claims, which are revenues gained from written off claims, and collection from purchased receivables, which are revenues from the servicer business.

Operating expenses

Around 15% of operating expenses are incurred from operating assets. (Excluding expenses on interest repayment)

Financial expenses

The funds lent to customers are financed through borrowings from banks and other financial institutions and issuance of bonds. Financial expenses are interest payment on the financed funds.

Provision of allowance for doubtful accounts

Bad debt is written off when collection of receivables is deemed impossible. Allowance for doubtful accounts is provided for against losses from future bad debt. Additional allowances are provided for after writing off bad debt using the allowance for doubtful accounts and calculating the necessary allowance to prepare for future bad debt.

Expenses on interest repayment

Provision for loss on interest payment has been provided for to prepare for future interest repayments due to the rapid increase in interest repayment claims following the Supreme Court decision in January 2006. The claims are on a decreasing trend, dropping to more than 90% of the peak in monthly basis in recent years.

Other operating expenses

These are general and administrative expenses, which include personnel expenses, advertising expenses, promotion expenses, commission expenses, and depreciation.