MYbank, the online financial institution tied to China’s Alibaba Group Holding, has been granted approval by the Chinese banking regulatory body to begin operations.
Reuters reported Wednesday (May 27) that MYbank, which is part owned by Ant Financial itself and linked to Alibaba, will launch next month – marking an example of how Internet-based financial institutions are moving into what has long been the province of the country’s “traditional” banks, including small and micro loans.
MYbank begins operating with registered capital of 4 billion yuan, the China Banking Regulatory Commission said Wednesday. The company joins WeBank (owned by Tencent) as private banks approved to enter the Chinese finance industry, which is largely state-run.
MYbank will be 30 percent owned by Ant Financial, which is controlled by Alibaba head Jack Ma and other Alibaba executives. Significant MYbank stakes will also be held through Fosun International and Wanxiang Group. Those two companies will have respective 25 percent and 18 percent stakes through subsidiaries.
Reuters noted that through the period that ended last month that Ant Financial had made as much as 400 billion yuan in micro loans to more than 1.6 million Chinese businesses — and that tally had a bad debt ratio of around 1 percent, according to the company.
“MYbank is an important milestone for Ant Financial’s development to provide financial services for small and micro enterprises and individuals,” Yu Shengfa, head of MYbank, wrote via email to Reuters.
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