When Alipay was first launched in 2003 as a payment escrow solution to resolve the trust issue between buyers and sellers on Alibaba’s Taobao, no one would have foreseen that on the basis of this simple payment service, Alipay would grow to be the world’s leading mobile payment platform. Fast forward to 2020, and Alipay’s parent company Ant Group’s initial public offering (IPO) could be the world’s largest in history.
Over Alipay’s 17 year journey, the platform grew in financial technology firm Ant Group, providing a wide array of fintech services across the world. Along the way, Ant Group paved the way for a new era of Chinese innovation, as its services provided the platform for many businesses to build upon in sectors like ride-hailing, e-commerce, and food delivery.
The blockbuster IPO also puts Ant Group’s relationship with Alibaba under the spotlight, as the alliance between the two sector leaders has resulted in the concentration of droves troves of user data and financial security.
Read more: BIZ IN GRAPHICS | Ant Group to launch what could be the world’s biggest IPO soon
Going through Ant’s prospectus, it is clear that Alibaba, though the largest shareholder and biggest client by contribution to revenue, doesn’t own a veto power in the fintech giant’s decision-making, because its shareholding in Ant is less than a third of the total.
However, the two companies’ businesses are highly intertwined. Alipay is the one and only digital payment method powering Alibaba’s countless online and offline services, while Ant Group’s Alipay depends on Alibaba’s apps for user traffic.
Furthermore, Ant Group and its cross-border payment services are essential partners to Alibaba’s construction of localized e-commerce platforms in the global market.
At the same time, a third of Ant’s board and management team have an Alibaba background.
