Can Alibaba’s Ant Financial Disrupt the Financial Industry_

Can Alibaba’s Ant Financial Disrupt the Financial Industry_

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CKGSB KNOWLEDGE China­focused leadership and business analysis Search this website … Can Alibaba’s Ant Financial Disrupt China’s Financial Industry? AUGUST 5, 2015 BY MAJOR TIAN 0 COMMENTS In a short space of time Alibaba’s Ant Financial Services Group has created—and scaled—a diverse set of financial products and services: from online payments to cloud computing and data services. Ever since Alipay, China’s most used online payment platform, was transferred away from the Alibaba Group in 2011, it has grown into a billion-dollar company that has a finger in almost every pie in China’s booming internet finance industry. Renamed Ant Financial Services Group late last year, the company has grown beyond just online payments to services like microlending, banking, credit scores, etc. (Alipay, the original online payment service, is now one part of the larger Ant Financial.) The company just finished its first round of financing in July, reportedly raising more than RMB 10 billion ($160 million) on a valuation as high as RMB 310 billion ($50 billion). What’s more eye- catching than the numbers is the lineup of leading investors—it includes a group of state-backed insurance companies as well as the country’s National Social Security Fund (NSSF). It’s the first time that the NSSF, which manages about RMB 1.2 trillion in assets, has directly invested in a private company in China, according to the fund’s website. Ant Financial sold 5% of its shares to the NSSF “at a significant discount”, Caixin reported. But the company’s ambitions go far beyond a high valuation, said Jing Xiandong, President of Ant Financial, told the Chinese press at various occasions. According to Jing, Ant Financial’s goal is to build a new and truly inclusive financial system on the internet that better serves small businesses and the public. So what is Ant Financial all about? What kind of products and services does it offer? Alipay and Yu’e Bao As far-reaching as the company’s aspiration is, Ant Financial certainly has a solid foundation to start from. Its flagship product Alipay controls more than 82% of China’s online payment market, according to iResearch, a consulting firm. With more than 400 million real-name users, the platform now processes on average 120 million transactions per day, according to Caixin . In comparison, data from People’s Bank of China shows that in 2014, the country’s banking system handled about 170 million non-cash transactions on average every day (this includes bills, bank cards and all electronic transfers).
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  • One '14
  • Financial services, Alibaba Group, Ant Financial

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