Mobile Commerce

New Funding Gives Alibaba’s Financial Arm $45B Value

Following a new round of funding, Ant Financial — which includes the online payment option Alipay — has earned a new value that just might propel its mission into becoming a publicly traded company.

A Reuters report yesterday (June 18) cited unnamed sources said to be close to the matter that said Alibaba’s financial arm has closed a private placement funding round that would give it a value of roughly $45 billion.

Reuters’ source indicated that Ant Financial sold stakes to outside investors, which included Alibaba Executive Chairman Jack Ma’s private equity firm Yunfeng Capital. Reuters also relayed that China’s state-run Shanghai Securities News reported in February that Ant Financial was looking to raise as much as $4 billion in private placement of shares.

Ant Financials’ cash cow has been Alipay, which has been a driving force in Alibaba’s eCommerce growth. Alipay is China’s most popular online payments option. In fact, 78 percent of transactions on Alibaba’s China commerce retail marketplace are paid through Alipay.

Alipay spun out of Alibaba in 2011, giving Jack Ma a controlling interest in the new company, Ant Financial. In addition to Alipay, Ant Financial provides a number of financial services to Chinese consumers, including money market funds. Reports released early in 2015 indicate that Ant Financial will go public in 2016. Upon going public, Alibaba will be entitled to a share of earnings at Ant Financial.

In March, Ant Financial rolled out Sesame, which is a credit scoring service that works by reviewing user profiles and behavioral data from Alibaba’s marketplaces. The services began in late January, but only for testing purposes, and later became widely available for Alipay users who want to check their credit level through a mobile app.

To check out what else is HOT in the world of payments, click here.



B2B APIs aren’t just for large enterprises anymore — middle-market firms and SMBs now realize their potential for enabling low-cost access to real-time payments and account data. But those capabilities are only the tip of the API iceberg, says HSBC global head of liquidity and cash management Diane Reyes. In this month’s B2B API Tracker, Reyes explains how the next wave of banking APIs could fight payments fraud and proactively alert middle-market treasurers to investment opportunities.

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