Chinese tech giant Alibaba’s financial arm Ant Financial (蚂蚁金服) is hatching an ambitious plan to reach its services to about 2 billion people outside China.
This was revealed during a September 19 speech by Ant Financial CTO and COO Cheng Li at the Hangzhou Computing Conference 2018.
“About 2 billion people living in many Belt and Road Initiative countries do not even qualify for a bank loan. We want to bring financial services to those people and let them enjoy the endless possibilities of the digital economy," Li said.
The Belt and Road Initiative (BRI) is a China-led multibillion-dollar infrastructure development project often touted as the “21st-century silk road.” As many as 71 countries across South Asia, Europe and Africa representing half the world’s population and a quarter of its GDP are part of the ambitious programme.
Speaking at the event Li said that the Chinese city of Hangzhou, that houses Alibaba Group’s headquarters, has emerged as the “world capital for electronic payment.” Foreign visitors wish to go back and replicate the same system in their countries, he claimed.
During his speech, he also spoke about two of his organization’s most famous business strategies—“1+9 abroad” and the business line of international transfers. Li explained that Ant Financial’s association with Paytm (India), Truemoney (Thailand), GCash (Philippines), Kakaopay (South Korea), Dana (Indonesia), Alipay HK (Hong Kong), Touch'n Go (Malaysia), Bkash (Bangladesh) and Easypay (Pakistan) represent the nine associations that lend "1+9 abroad" its name.
For Ant Financial, cooperation with local companies helps it understand local cultures and user habits making the international expansions easier.
Speaking about his company’s future plans, Li said that Ant Financial hopes to implement a system in which any person in any part of the world can send and receive money from anywhere else in the world in a simple, safe and instantaneous way.
Alipay HK, Alipay's local platform in Hong Kong, started to implement blockchain-based international transfers in June 2018. Speaking at that event Alibaba Group chairman Jack Ma had admitted that international transfers have been one of Alipay’s main areas of concern ever since the start of the service.
Ant Financial can find opportunities for growth in developing countries where the internet users present a lot of potential. Ant Financial's international expansion is synchronized with that of Alibaba’s.
A robust electronic payment and a logistics system are an absolute must for e-commerce to thrive.
During Taobao's early days, Alibaba launched Alipay, which worked as a third-party manager of payments, thus solving the trust issues between vendors and customers and at the same time, optimizing the user's experience. This was one of the keys to the success of Alibaba's e-commerce.
Electronic payments and e-commerce are mutually interdependent. In order to establish a global e-commerce platform, Alibaba has to resolve global logistics and payments.
Jack Ma has spent a lot of time trying to lead eWTP, Alibaba-lead Electronic World Trade Platform, in that direction. Cainiao, Alibaba's logistics affiliate, has also started to expand abroad.
In the future, Alibaba could start cooperating with and investing in local logistic companies. Logistics could follow the same logic applied to electronic payments.