Alibaba’s Internet Bank to Assist Small and Medium Enterprises
MYbank, Alibaba’s financial affiliate internet bank is now targeting small and medium Chinese enterprises who are currently struggling to get credit from other major financial institutions. MYbank which is 30 percent owned Alibaba linked Ant Financial Services Group has around 4 billion in registered capital and are offering loans of up to 5 million yuan.
The bank will only be able to take in deposits when regulators will finally give its approval on a facial recognition technology that will allow customers to remotely open bank accounts. MYbank will be on hand to give out affordable loans to small and micro sized enterprises and will also be providing banking services.
MYbank services are similar to Alibaba’s rival WeBank of Tencent Holdings the first online bank that started trials operations in January. Meanwhile Mybank’s target clients are showing little threat to China’s big State owned lenders that seen deposits eroded by wealth management product Yu’e Bao of Alibaba that is now the largest money market fund in China. Furthermore internet banks stated that they will be lowering overheads from online operations to allow them to offer more competitive interest rates compared to larger banks.