Until recently, Ant Financial is most commonly known as the parent of China’s default payment app Alipay, and therefore, a financial service in the eyes of most. However, the Alibaba affiliate is gradually finding a new position as a technology services company. By outsourcing all of its technical capabilities that have been mastered by running Alipay, the company is turning traditional financial service providers from competitive rivals to cooperative clients.
Ant Financial is opening up its technology capabilities to financial service institutions for them to solve problems in financial security, massive financial transactions, and blockchain applications announced Hu Xi, Deputy CTO of Ant Financial and Partner of Alibaba Group, at The Computing Conference. Open technology capabilities are expected to become the core monetization model of Ant Financial, according to the firm.
Started out as Alipay, Ant Financial tries to solve all the basic technical problems since its inception in 2004. After opening up its payments services to a wide range of online and offline businesses, Ant Financial announced an “Internet Booster” plan in 2015 to support the digital transformation of traditional financial institutions by sharing Ant Financial’s technological capabilities. The new announcement marked the company’s effort to speed up the initiative in providing standardized and comprehensive technical solutions to all the financial services.
Ant Financial’s technology-based solutions allow financial institutions to deliver services, from payments to risk management efficiently, all at scale. In payments, for instance, Alipay was able to process a record-breaking 256,000 transactions per second at the peak of the 2017 Single’s Day Shopping Festival.
The company has already partnered with over 200 financial institutions around the world, including over 100 banks such as Commercial Bank of China, China Merchant Bank, MyBank— China’s 1st commercial bank with core system running on a distributed architecture—over 60 insurers and north than 40 funds and securities.
For Ant Financial, the change also underlines a shift in the nature of its clients, from individual customers, where it already takes a grip through Alipay, to financial enterprises clients. Hu explained that a transition from customer-faced (2C) to business-faced (2B) business comes in line in a changing landscape in China.
“The past two decades, relatively the span of China’s internet history, was a period when customer-faced services experience a quick boom. Back then, there’s no digital infrastructure in China, so 2C service is a good place to start. But today’s China is under urgent need to increase efficiency, no matter it takes the form of a push to increase production capacity, upgrading traditional manufacturing industry or consumption upgrading. Digitalization of enterprises is a possible solution for it,” says Hu.
At the same time, Alibaba’s established foothold in the 2C market is expected to benefit a 2B foray thanks to deep industry insight and vast business connections.
Looking forward, Hu also touched on some of the technical explorations and challenges in the future, suhc as real-time secure computing on top of a large volume of IoT data, giving AI financial grade capabilities, pursuing continuous availability with zero data loss, making the digital world secure and trustworthy, and giving everyone a reliable digital identity.