MICROCAPITAL BRIEF: Alibaba’s Ant Financial Raises $4.5b from Investors Including China Life, China Post Group, China Development Bank Capital, Primavera Capital Group to Expand Services in Rural Areas

Ant Financial Services Group, an online lender affiliated with Alibaba Group Holdings Limited, a Chinese e-commerce company, recently completed a Series B equity raise of USD 4.5 billion. First-time investors in the firm included consortiums led by China Investment Corporation Capital and CCB Trust, a subsidiary of China Construction Bank. Existing shareholders also increased their commitments, including China Life, China Post Group, China Development Bank Capital and Primavera Capital Group.

The money raised will be used to continue expanding Ant Financial’s provision of financial services in China’s rural areas, developing the firm’s cloud computing infrastructure, adding biometric verification technologies, and assisting with the company’s expansion outside of China.

As of 2015, Ant Financial had approximately 450 million active users in China, of whom approximately 140 million were based in rural areas. Ant Financial’s MyBank and Ant Micro Loan collectively had provided microloans to approximately 20 million customers, including micro- and small businesses as well as individuals. Alibaba Group Holdings reported total assets of USD 41 billion and total income of USD 4 billion for its financial year ending 2015. Jack Ma, Alibaba’s Executive Chairman, will retain majority ownership of Ant Financial.

By Imke Herholdt, Research Associate

About Ant Financial Services Group (Ant Financial)
Ant Financial was founded as Alipay in October 2014 by Alibaba Group Holdings Limited, a Chinese e-commerce company. It was spun off from Alibaba in 2015 to become Ant Financial and is controlled by Jack Ma, Alibaba’s Executive Chairman. Ant Financial continues to use the Alipay brand for an online platform that provides financial services including payments, wealth management, insurance and microloans to micro- and small enterprises as well as individuals. As of 2015, Ant Financial had approximately 450 million active users in China, of which approximately 140 million were based in rural areas. Ant
Financial also owns MyBank, a private bank established in June 2015; Ant Micro Loan, its microloan business; and Yu’e Bao, a money market fund, amongst others. Mybank and Ant Micro Loan collectively provided micro-loans to approximately 20 million individuals, micro- and small businesses. Alibaba Group Holdings reported total assets of USD 41 billion and total income of USD 4 billion for its financial year ending 2015.

Sources and Additional Resources
[1] Forbes: Alibaba’s Ant Financial Raises $4.5 Billion In World’s Largest Private Tech Investment Round
[2] Wall Street Journal: Alibaba Affiliate Ant Financial Raises $4.5 Billion in Largest Private Tech Funding Round
[3] Fortune: Alibaba Affiliate Ant Financial Just Raised $4.5 Billion
[4] Wall Street Journal: 5-things to know about China’s Ant Financial
[5] Alibaba Group
[6] MicroCapital Universe Profile: Alibaba Group

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