On February 1st, Alibaba and Ant Finance jointly announced that, according to their strategic agreement signed in 2014, Alibaba will acquire 33% of Ant Finance’s shares through one of Alibaba’s subsidiaries.
China's recent outbound M&A has been suffering with more and more acquisitions failing due to national security concerns, Ant Financial's missed acquisition of MoneyGram being the latest. Why does national security factor into these decisions and why will it remain a crucial consideration in the future?
In China, bar code payments (including QR codes) dominate the mobile payment market. Using a bar code to pay is easy, but comes with risks. In 2017, about RMB 90 million ($14 million) was stolen due to fraud. On December 25th, 2017, the People’s Bank of China (the PBOC) released new regulation to standardize bar code payments. The regulation will come into effect from April 1st, 2018.
On December 11th, 2017, China Union Pay (CUP), together with over 30 commercial banks and payment institutions, launched a new version of its mobile payment APP, QuickPass (云闪付), starting a new battle in the mobile payment industry.
China Telecom and China Mobile, two of China's leading telecommunication companies, were approached by the Chinese government under a proposition to enter the Philippines telecommunications market.
With Bitcoin recently hitting an all- time high of $14,000 USD on December 7th 2017, many have been asking questions about whether the cryptocurrency’s price will continue to rise in the future or if it is simply a speculative bubble waiting to burst. The currency has risen by over $13,000 USD since the 1st of January 2017, a remarkable, and for some unfathomable surge considering it has no tangible assets or value at its core.
It was reported on September 20th 2017 that 17 companies involved in the consumer finance sector had a net profit of 974 million Yuan for the first half of 2017, which was approximately the total net profit for all of 2016. This explosive growth has caused growing concerns amongst regulators who are considering ways to implement a crackdown on the industry.
Since Chinese online micro lending companies Qudian and Paipai Dai have gone public on the New York Stock Exchange (NYSE), the government has been closely following the development of the micro-credit industry. Scrutiny has fallen not only their business model but also on their high revenue, which specifically caught people’s eyes. The Ningbo Jinzhou Financial Office already shut down two micro lending institutions. On November 21, 2017, the General Office of the State Council issued an urgent notice on suspending approval on the establishment of internet small loan companies. With the arising attention around financial risks, could this be the end of the industry?
Singapore’s PayNow and Thailand’s PromptPay are set to link their national digital payment systems, thereby making it easier to send money between the two countries.
Two weeks after the 19th Communist Party of China (CPC) national congress, the Chinese state council set up the Financial Stability and Development Committee (FSDC), as the institution to ensure the stability of the financial system and provide solutions for future development.
In the venture capital industry, a ‘unicorn’ refers to any technology start-up company which has reached a valuation of over USD $1 billion, as determined by private or public investment. The term was devised by venture capitalist Aileen Lee, founder of CowboyVC, a venture capital fund based in Palo Alto. She discovered that only 0.07% of software start-ups founded in the 2000s would ever reach a $1bn valuation, thereby being as rare as finding a unicorn.
It is quite obvious that Alipay is the largest mobile payments platform in the world, with approximately 400 million registered users. Third-party payment platforms play an integral role in Chinese consumers’ everyday transactions because of the multi-faceted services offered, such as ecommerce and mobile payment transactions.
According to iResearch data released in September 2014, the Gross Monetary Value of China’s third-party online payments reached 1,840.66 billion Yuan (USD $299 billion), with year on year growth of 64.1%.
The People’s Bank of China (the PBOC) started issuing the Payment Business License since May 2011 to non-banking institutions. Up until March 2015, the PBOC had issued 270 payment licenses.
Qudian lnc, the Chinese micro lending company, has filed for a U.S. IPO at the NYSE earlier last month. It plans to raise up to USD $750 million in capital to spend on strategic acquisitions, marketing and borrower engagement. In only a few years, Qudian has become an eye catching internet lending company with a valuation of over $6.9 billion USD. Qudian’s remarkable success in such a short period of time, shows how profitable the cash loan market can be, as well as the incredible opportunities for transformation that can arise when collaborating with internet giants like Alibaba.
The Financial services sector is integrating AI (artificial intelligence), machine learning and predictive analytics at a remarkable rate for both customer-facing and back-end operations. One element commonly associated with AI, but one that has not yet made a strong impact, are ‘chatbots,’ computer programs designed to simulate conversation with human users. However, this could be about to change, with large financial institutions starting to experiment and launch products leveraging AI technology.