(Yicai Global) Dec. 1 -- China's bike-sharing giants Beijing Bikelock Technology Co. (Ofo) and Beijing Mobike Technology Co. (Mobike) have refuted industry insider reports that they have used up to CNY6 billion (USD907.4 million) in user deposits in order to fill gaps in funding and have also suspended payments to vendors such as factories and PR firms in separate press briefings, the firms said in separate press briefings yesterday.
The two bike-sharing firms are facing financial problems related to their respective efforts to aggressively expand market presence, financial media outlet Lanjinger quoted a market insider as saying.
Ofo confirmed in response that all of its refund methods are functioning well at present and it has rolled out deposit-free riding services in 25 cities domestically. Mobike responded by saying the reports were the reports were not in line with the facts and that it would explore channels to protect itself.
Mobike has raised at least CNY6.4 billion since its founding in 2015, while Ofo has obtained at least CNY8.8 billion in financing since its establishment in 2014. Neither firm has have achieved profits so far.