Ant Financial Changes Business Direction From Finance To Blockchain Technology

Chinese Fintech company, Ant Financial will be focusing on offering technology services, while stepping away from its financial services currently being offered because of the overwhelming presence of Beijing regulators.

Ant Financial, established in 2014 by Chinese business magnate and philanthropist, Jack Ma, will be making the crucial changes to its entire business in the years to come, stated sources very close to the firm. The main reason for a complete change in direction is believed to have been due to the demand for regulation in the services they provided.

Although the company was able to successfully pave a path within China’s finance-tech sector, especially with its Alipay payment app that had many giants onboard the notion of a “cashless society”, projections indicate that growth within the finance sector might stagnate.

Based on the company’s confidential five-year forecast, which was deemed by Reuters, Ant Financial’s revenue will mostly be generated through tech services, namely, 65% (almost twice as much compared to that of 2017). When considering its involvement in financial services, the company’s revenues is said experience the opposite effect, that is, a 6% drop from its original 11%.

Zennon Kapron, Director at Kapronasia, believes that the move made by the company best reflects what they stand for.

He also stated that,

“It fits within the government’s view of the way that the financial industry would develop.”

Getting back to Ant Financial’s future plans, an initial public offering is supposedly in store for the next year, which will be mainly executed in China and Hong Kong. The goal is allegedly to raise $10 billion.

According to the same sources, Ant has been bombarded with regulators, with many watching them on a daily basis. The main reason being the fear that the firm’s growth might one day cease, which can negatively impact the Chinese economy altogether.

They also argued that,

“As a non-bank, non-state-owned institution in China, it’s not allowed to independently grow too big to manage.”

As for how the changes will be made is still unclear, however, it has been hinted that the firm will be addressing several technology-based areas including the likes of blockchain, artificial intelligence, security, and cloud computing platforms, to offer services that meet the specific requirements, especially that of banks.

Based on the claims made by two of the sources, it appears that Ant Financial has been slowly leaving the financial sector, as they’ve removed themselves from the following activities: issuing credit ratings, and micro-lending business, explicitly, asset-backed securitization.

[FREE] Get Our Best Crypto Trading, Mining & Investing Hacks:

*Action Required* Enter Your Email To Get Insight For Trending Coin News & Reviews

I will never give away, trade or sell your email address. You can unsubscribe at any time.

LEAVE A REPLY

Please enter your comment!
Please enter your name here

13 − 11 =