E-commerce giant Alibaba has launched an online banking service. As Sonia Legg reports MYbank will target small and medium-sized Chinese enterprises that have struggled to obtain credit from major financial institutions.
It's already an e-commerce giant, now Alibaba is hoping to steal a slice of another sector - it's launched an internet bank, with an ambitious objective. MYBank will target small and medium-sized Chinese firms which have struggled to secure credit from bigger lenders. Jack Ma is Chairman of the Alibaba group. (SOUNDBITE) (Mandarin) CHAIRMAN OF ALIBABA GROUP JACK MA, SAYING: "China does not lack a bank. Neither does the world lack a bank. But both China, and the world, lack a bank that is innovative, and serves small businesses and consumers." MYbank is 30-percent owned by the Alibaba-linked Ant Financial Services Group. It has registered capital of almost $650 million and will offer loans of up to $800,000. It's not China's first online bank - Alibaba's arch rival Tencent took that title in January by starting trials of its WeBank. And it's unlikely to have an immediate impact on China's state-owned lenders. But it does have a track record in the financial sector - it's wealth management product Yu'e Bao is China's biggest money-market fund Jeremey Stretch is from CIBC. (SOUNDBITE): Jeremy Stretch, European Head of Strategy, CIBC, saying (English): "It is going to be interesting to see how the architecture and infrastucture of this bank really plays out, particularly in terms of risk management because I think that is one of the key metrics in terms of the financial sector and that's going to be an interesting scenario to play out and also in terms of the stability and rigidity of the technology." On that subject - MyBank has interesting ideas too. It plans to run on cloud computers and avoid using U.S. technology.