It is rumoured that Ant Financial Group adjusted its strategy before the IPO.
In 2004, Ant Financial launched Alipay, a payment app that initially offered only one service to shoppers on Alibaba’s e-commerce website. Today, Alipay has become an important tool for the payment industry and a means of promoting social integrity. Alipay is also widely used in the real world, with more than 80 million merchants raising money through the app every month.
According to media reports, Ant Financial Group has changed its strategic direction before going public and no longer seeks to become a “global payment leader”. China’s financial group has invested heavily in foreign e-wallet companies to become a global payment market leader. Some people familiar with the situation who have worked with ant financial group or are working with ant financial Group said that ant Financial Group has scaled back its overseas investments before going public, such as reducing its financial and personnel support to many overseas e-wallet companies.
This year, Ant Financial tacitly halted an ambitious expansion plan, despite the company’s efforts throughout 2019, people familiar with the matter said. The plan was to develop a global payment infrastructure based on the universal QR code system. T In addition to the local market, the QR code system can connect all e-wallets invested by Ant Financial Group. If the plan is successful, Ant Financial Group is expected to become a global payments leader. The group’s Alipay unit mainly serves Chinese consumers.
Ant Financial Group has invested in more than a dozen fintech companies around the world that offer electronic wallet services. Wallet allows users to store money and make digital payments without relying on a bank account. It is reported that Ant Financial Group has generally made losses in Singapore, the Netherlands, India and other parts of the company. Since 2017, the contribution from overseas regions has been very small, accounting for around 5% of the revenue, and only 4.4% in the first half of this year. Indeed, after stumbling in recent years from the UK to India and South-east Asia, it is clear that the company still faces challenges on its way to internationalisation.
While the DOLLAR-dominated international settlement system gives American tech giants a natural advantage in payments, Ant Financial still has no significant international advantage.
Outside the US, Ant Financial’s new leadership argues that the company’s resource allocation is too fragmented. The new leadership believes that many e-wallet partners may not be able to thrive in their own markets as competition intensifies. The new leadership believes that many e-wallet partners may not be able to thrive in their own markets as competition increases.
But according to the prospectus, Ant Financial group has not given up on overseas markets and plans to spend 10 per cent of the proceeds of the IPO on international operations. Meanwhile, as of June, Alipay had provided online payment, currency settlement and other services in more than 200 countries and regions overseas, according to the prospectus.
Some analysts believe that the slowdown of globalization of Ant Financial Group is on the one hand due to the smooth listing of ant Financial Group to meet the challenges of domestic regulation; On the other hand, geopolitics and protectionism have also affected the development of ant group’s overseas business.
It follows reports that the Trump administration is investigating national security restrictions on Tencent’s Ant Financial Group and digital payment platforms, even if restrictions on business partnerships with Ant Financial Group hurt U.S. companies. It also means that ant Financial Group’s operating risk in the United States is further increased.