SecProbe.io

Mail Stop 4720

June 26, 2018

Yue (Justin) Tang
Chief Executive Officer and Chairman
X Financial
7-8F, Block A, Aerospace Science and Technology Plaza
No. 168, Haide Third Avenue, Nanshan District
Shenzhen, 518067, the People's Republic of China

Re: X Financial
Amendment No. 4 to
Draft Registration Statement on Form F -1
Submitted June 2 1, 2018
  CIK No. 0001725033

Dear Mr. Tang :

We have reviewed your amended draft registration  statement  and have the following
comments.  In some of our comments, we may ask you to provide us with information so we
may better understand your disclosure.

Please respond to this letter by providing the requested information and either submitting
an amended draft registration statement or  publicly  filing your registration statement on
EDGAR.  If you do not believe our comments apply to your facts and circumstances or do not
believe an amendment is appropriate, please tell us why in your response.

After reviewing the information you provide in response to these  comments  and your
amended draft registration statement or filed registration statement, we may have additional
comments.

General

1. We note that throughout the registration statement, exclud ing revenue related disclosures,
you use the term “customers” to refer to borrowers.   Tell us your basis for referring to the
borrower as customer and how this aligns with the underlying contracts with the
borrowers.

Yue (Justin) Tang
X Financial
June 26, 2018
Page  2

 Delinquency Rate by Vintage, page 9 9

2. You state that under the New ZhongAn Model, the delinquency rates of your loan
products do not directly impact your financial statements after September 2017.  Please
address the following:

 Considering your obligation to compensate ZhongAn up to an agreed upon
percentage of the principal at loan facilitation - which is renegotiated quarterly based
on actual defaults - and the change in fair value of the related financial guarantee
derivative of RMB 46.1M or 32% of net income for the period ending March 31,
2018, please revise your disclosure to address this inconsistency.

 Enhance your Discussion of Key Balance Sheet Items on page 112 to explain what
drove the period -over-period increases in  your derivative liabilities.

Loss of Contingent Liabilities, page 109

3. We note your response to comment 3 and that the loss of contingent liabilities of RMB
182.6M was primarily due to the fact that Xiaoying Card Loan borrowers were not able
to borrow from other online lending platforms to fund their repayments due to tightening
industry regulations which included the prohibition of “cash loans.”  Please address the
following:

 Clarify within the stages of your Transaction Process as disclosed on page 1 56, how
you evaluate a borrower’s ability to fund repayment obligations, including how you
consider the risk of future borrower indebtedness;

 Enhance your risk factor discussions on pages 31 and 32 to discuss the material
impact to your financial statemen ts as a result of the loss contingent guarantee
liabilities recognized for the periods ending December 31, 2017 and March 31, 2018
due to borrowers inability to obtain cash loans to fund repayments and banking
policies requiring  increased working capital; and

 Add a Risk Factor addressing the risk to the industry and investors of borrowers’
practice of borrowing from other online lending platforms to fund their repayments
and the resulting potential impact to your business and financial statements.

Guara ntee Liabilities, page 111

4. We acknowledge your response to comment 4.  We note that you attribute the period over
period increase in your guarantee liabilities from December 31, 2016 to December 31,
2017 partially to the change in delinquency rate.  Consi dering that net payouts - which
represent borrower defaults net of amounts subsequently collected from the borrower -
drove the change in your guarantee liability as reflected on page F -46, please revise your

Yue (Justin) Tang
X Financial
June 26, 2018
Page  3

 disclosure to address how the period over perio d change in net payouts contributed to the
period over period change in guarantee liabilities.

Note 2.  Summary of Significant Accounting Policies, page F -9

Revenue Recognition, page F -16

5. We note in Section 4.1 of the Service Agreement between you and the investor a
description of contingent fee from the investor.  Please provide to us a description of the
economics of the fee, how the amount of the fee is calculated, and how you account fo r
the fee.  In addition, provide us with an illustration of such a fee to demonstrate how it
operates.  Last, tell us where you recognize revenue for this fee and the amount of
revenue recognized for the periods presented in your recent DRS/A.

6. We underst ood from Section 2.2 of the Consulting Service Agreements with the borrower
and Section 3.1 of the Loan Contracts between the borrower and the investor that the
borrower is aware of the fee charged by you and by the investor, respectively, under each
agree ment and considers each fee when making a financing decision.  Please clarify the
total fee that the borrower considers when making his or her financing decision.  For
example, is the borrower only legally obligated to pay the stated interest rate to the
investor (from which the Company’s service fee is deducted) or is the borrower legally
obligated to pay both the stated interest rate to the investor and the service fee to the
Company? Please point us to the contractual terms that dictate the fees the borr ower
considers when making a financing decision.

7. The Consulting Service Agreements (e.g., Sections 1.2 and 2.1) with the borrower appear
to indicate that you perform a matching service for the borrower that conveys a benefit to
the borrower in exchange fo r a fee.  Please reconcile for us the contractual terms of your
agreements with your accounting conclusion under ASC 606 that the borrower is not a
customer.  Include in your response a step -by-step illustration of the life of the loan that
shows the fees assessed, the payments made by each party, and the timing of each
payment.  In addition – and acknowledging your response to comment 45 in your letter
dated February 28, 2018 – include an illustration of a loan defaulted by a borrower, along
with an explana tion as to whether you have the ability to pursue collection from the
borrower for amounts owed to you under the Consulting Services Agreement in situations
where the borrower defaults before ever making a payment.

8. We understood from our conference call o n June 19, 2018, that you combine the
contracts between you and the investor and you and the borrower when accounting for
revenue from contracts with customers.

 Please explain to us how you considered the guidance in ASC 606 -10-25-9 in
determining that these contracts may be combined when the investor and borrower
are not the same customer (or related parties of the customer);

Yue (Justin) Tang
X Financial
June 26, 2018
Page  4

 Please help us understand the effects on your financial reporting if you do not
combine contracts. To this end, we understood fr om our conference call on June 19,
2018, that one effect would be a gross -up of revenues and bad debt expense on the
income statement and of accounts receivable and an allowance for bad debts on the
balance sheet.  Please explain to us any other effects, a s well as how you would
determine the amount of fee that is from the borrower that would be subject to the
gross -up versus the amount of fee that is from the investor that would be subject to
implicit price concession.

Note 4.  Fair Value of Assets and Li abilities, page F -40 & F -73

9. We note your response to comment 7 and your disclosure on page F-17 in which you
state that your contractual obligation at any time is limited to the lower of (1)  total
amount of guarantee fees contractually required to be coll ected from the borrowers for
such loans facilitated during the current period on an aggregated basis, and (2)  a certain
percentage of the total principal of the loans facilitated as pre -agreed with ZhongAn (the
"Cap").  Please address the following:

 Disclose why your guarantee derivative liability includes the difference between the
Cap and the total amount of guarantee fees contractually due, net of estimated
defaults and prepayments, and not the lower of as disclosed ;

 Disclose that your contractual o bligation of total guarantee fees contractually required
to be collected from the borrowers for such loans facilitated during the current period
on an aggregated basis, is net of estimated defaults, and prepayments;

 You disclose that total Xiaoying Card L oan products related to the guarantee
derivative liabilities facilitated during the three months ended March 31, 2017 was
RMB 6,209,207,944.  Please confirm and revise accordingly that such loans relate to
the three months ended March 31, 2018; and

 Disclose the underlying calculation of the estimated payment to ZhongAn based on
the pre -agreed Cap of RMB 487,476,969 and discuss why such amount does not
equal total Xiaoying Card loan products for the three months ended March 31, 2018
at the applied Cap  rate of 8.62%.

Note 8.  Guarante e Liabilities, pages F -45 & F -80

10. Please revise your next amendment to include the reconciliation provided in response to
comment 8.

Yue (Justin) Tang
X Financial
June 26, 2018
Page  5

 You may contact Michelle Miller at (202) 551 -3368 or David Irving at (202) 551 -3321 if
you have questions regarding comments on the financial statements and related matters.  Please
contact David Gessert at (202) 551 -2326 or me at (202) 551 -3391 with any other questions.

Sincerely,

 /s/ Michael Clampitt

Michael Clampitt
Senior Counsel
Office of Financi al Services

cc:  Li He, Esq.