The Alibaba company owned by Jack Ma plans to raise $1 billion for an investment fund dedicated to Asian fintechs, according to Bloomberg. Art Financial is looking for new growth drivers outside its domestic market, where it has to contend with social networking specialist Tencent.
160 investments in regional start-ups
In just 5 years, Ant Financial has made almost 160 investments in startups in the region, including 100 in the last 2 years. For example, the Chinese company has invested in Paytm, a fintech that saw its growth soar during the demonetization plan announced 3 years ago by Indian Prime Minister Narendra Modi, and whose valuation recently reached $16 billion.
The company that operates the Alipay online and mobile payment system has announced a $1 billion round of funding for an investment fund dedicated to startups located in India and Southeast Asia. The deal would primarily target growth-stage companies specializing in online payments and finance. In June 2018, Ant Financial raised an extraordinary $14 billion. This new initiative should enable it to expand even further.
Alipay, Ant Financial's flagship solution
Alipay, a 100% subsidiary of Ant Financial Services, provides payment services and escrow accounts that can be used on several of the group's platforms, including Taobao, Tmall and AliExpress. This solution can be used to pay for a cab, an electricity bill or even a doctor's appointment. In 2018, Alipay had over 600 million active users in its domestic market, while its main competitor, Tencent-owned Wechat Pay, claimed 520 million.
In addition to Alipay, Ant Financial has developed a whole catalog of financial products. These include a credit offering for individuals and entrepreneurs (Huabei), a remote IT storage service (Ant Financial Cloud), an online bank (MYbank) and a wealth management application (Ant Fortune).
A digital banking license in Singapore
The electronic payments platform has other projects in the pipeline. It has applied for a digital banking license in Singapore in order to offer its services to customers in the rest of the region, who are still unbanked. The Monetary Authority of Singapore has announced that it is issuing 5 licenses, while more than 21 applicants are in the running, including smartphone manufacturer Xiaomi and video game publisher Razer. The regulator will reveal the winners in June to enable players to start operations from mid-2021. "We look forward to contributing to the development of the digital banking landscape in Singapore," Ant Financial said in a statement.