Restaurant operator Vongroup has bought a Beijing consumer finance company for 20 million yuan as it branches out into what it says is a high-growth business. Vongroup chairman David Vong said the 100 per cent acquisition of Beijing Shuntong Secured Consumer Finance would be a platform from which to expand business to Guangzhou, Shenzhen and later Shanghai. The deal announced on Tuesday night represents almost twice Shuntong's net asset value of 10.5 million yuan at the end of last year. Since consumer lending is highly capital-intensive, Mr Vong said the Hong Kong-listed company would introduce strategic investors from the US and Japan and would not rule out the possibility of raising funds. Secured consumer finance lending is a burgeoning business on the mainland, as the consumption needs of the increasingly affluent middle class grow and bank credit tightens. The rise in lenders however has been limited by the government. According to official statistics, about 100 'pawnshops' are in operation for every one million people in Taiwan, 59 in America, 48 in Japan but the ratio in China is only one per million. About 35 pawnshops operate in Beijing. Mr Vong said consumer financers borrowed money from banks at an annual cost of 6 per cent and lend it to clients with collateral for a maximum term of six months. 'Providing you get the necessary funding, it is a good business offering 35 per cent to 60 per cent return without almost any risks of bad debt because we lend at only 40 per cent of the collateral value,' he said. Beijing Shuntong had a loan book of about 60 million yuan in 2004. About 82 per cent of collateral is real estate, securities and cars with the rest jewellery, Mr Vong said.