BEIJING (Reuters) - Chinese e-commerce firm Alibaba Group Holding Ltd said on Thursday it has changed the name of its Alipay financial services affiliate to Ant Financial Services Group as it steps up its push into the financial services industry.
Alibaba has been aggressively offering new financial services around Alipay, including a money market fund for consumers, a mobile payment app and even a new private bank that was approved by the Chinese government in September.
Due to Alibaba’s dominant market position in e-commerce, Alipay has emerged as the online payment processing leader in China. It clears 80 million transactions per day, including 45 million transactions through its Alipay Wallet mobile app, the company said on Thursday.
The rebranding of the Alipay unit, whose legal name is Zhejiang Ant Small and Micro Financial Services Group Co, is part of a strategy by Alibaba and its affiliated companies to accelerate development of financial business. The name ‘Ant’ was chosen to symbolize the potential strength of a number of smaller brands working together, executives said.
At a day-long presentation in Beijing, Ant Financial executives outlined a vision of turning its mobile payment app into a full-fledged, data-driven commercial platform. They have their sights set on a service where businesses can deliver personally tailored smartphone ads and promotions based on Alipay data gleaned from an individual consumer’s shopping habits.
“China has never been lacking banks; it has 200 of them,” said Ant Financial Chief Executive Lucy Peng. “But we have an opportunity to use Internet methods, Internet technology, Internet thinking to disrupt traditional finance.”
Alibaba controversially spun out Alipay in 2011, but its executives including executive chairman Jack Ma maintain control of the payment processor, considered by some analysts as one of the most valuable assets in the Alibaba universe due to its unique position in Chinese commerce.
The new Ant Financial umbrella will oversee six financial services entities that are affiliated with Alibaba, but were not part of the company that listed on the New York Stock Exchange last month in Alibaba’s $25 billion initial public offering.
The six entities include: Alipay; Alipay Wallet; Yu‘e Bao, a money market fund with 570 billion yuan ($93 billion) under management; Zhao Cai Bao, a third-party financial services platform; micro-loan provider Ant Micro; and MYBank, a private bank.
MYBank received approval from Chinese banking authorities in September, part of a pilot program launched earlier this year and the first tentative step by the country to open its closely guarded banking sector to private investors.
Alibaba stated in its IPO prospectus that given regulator approval, the Alipay affiliate could issue 33 percent of its shares to Alibaba in the future. Ant Financial executives on Thursday confirmed the terms, but said there were no new changes to the plans.
In response to a question, Peng said there are no current plans for Ant Financial to hold an initial public offering of its own.
Reporting by Gerry Shih; Editing by Kenneth Maxwell