Mar 25, 2021

2014 to 2020: the Ant Group story

Payments
Money
China
Tilly Kenyon
3 min
From start up to China’s biggest payment provider, where did Ant Group come from and where is it going?
It's China’s biggest payment provider, but where did Ant Group come from and where is it going...

The rise of digital payments is continuous, but perhaps even more so this past year with Covid-19, a cashless society has become the norm.

In February 2020 the Payment & Clearing Association of China (PCAC) launched an action to encourage people to use online, mobile and QR payments to avoid the risk of infection. It was found that by March about 776 million people were using mobile payments in China

Who is Ant Group?

Ant Group is China's biggest payments provider, with more than 730 million monthly users on its digital payments service Alipay. 

Formally known as Ant Financial, Ant Group is an affiliate company of the Chinese Alibaba Group and was set up in 2014. The group owns one of China's largest digital payment platforms Alipay, founded in 2004, which serves close to one billion users. Ant Group was formed not only to serve as the parent company to Alipay but also to other financial services such as loans and wealth management.

Ant Group was set to raise more than $34 billion in an initial public offering (IPO) in November 2020. The float would have broken records as the biggest in history until it was suspended at the 11th hour. 

Why did the regulators in Shanghai and Hong Kong suspend the IPO?

Regulators had a meeting with Ant Group founder Jack Ma and other top executives of the company, during which it was made clear to the company that they needed to ‘rectify’ its lending, insurance and wealth management services, and that they would be subject to greater governmental oversight. 

The Shanghai stock exchange made a statement regarding the situation: “Your company has also reported significant issues such as the changes in financial technology regulatory environment. These issues may result in your company not meeting the conditions for listing or meeting the information disclosure requirements.”

The statement links to the drafted new rules about microlending, which could curb the profits and growth of fintechs in the region. These rules were proposed by China’s central bank, The People’s Bank of China, and the China Banking and Insurance Regulatory Commission. 

The suspension affected Alibaba, which owns about a third of Ant Group and whose technology supports its payments system, as they fell by nine per cent in the US trading market. 

What is the latest?

Earlier this month Ant Group CEO Simon Hu unexpectedly resigned for "personal reasons" as the company underwent a restructure. Hu, who was named chief executive of the Alibaba Group Holding affiliate in 2019, has been replaced by executive chairman Eric Jing.

Ant Group is now demanding bigger fees in order to rebuild valuation as it tries to counterbalance losses from the government clampdown on its lending business. They are requesting profitable commissions from its payment platform at the expense of local banks. 

This move will allow Jack Ma, the controlling shareholder, to restore the group's valuation after the pull of the company's planned initial public offering.

“Ant is still looking for an IPO and it wants to improve its valuation that has taken a hit from the regulatory overhaul,” a person close to the company told the Financial Times. “The solution is to grow in areas that come with fewer restrictions.”

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Jun 13, 2021

Harnessing APIs to unlock and operationalise your data

technology
Data
insights
Paul Crerand
4 min
It’s widely accepted that unlocking insight from data is key to driving successful digital transformation and competitive advantage

Data is the fuel that powers modern businesses. It’s widely accepted that unlocking insight from data is key to driving successful digital transformation and competitive advantage. Yet the gap between understanding the importance of data-driven insight and being able to achieve it remains stubbornly wide, as critical information remains locked away in silos. To overcome these challenges, businesses must try a new approach. API-led connectivity offers a reusable, standardised way to integrate data across multiple platforms, systems, and applications. When done right, it can be the fast-track to IT and business teams productivity, innovation, and growth.

A data explosion

The past decade has seen a data explosion. Analyst firm IDC predicted that over 59 zettabytes (ZBs) of data would be “created, captured, copied, and consumed” in the world last year alone. In the next three years it’s predicted to continue growing at a CAGR of 26%, during which time more data will have been created than during the past 30 years. At the top of any CIO or business leader’s wish-list is the ability to extract insight from these vast troves of information in order to make more effective decisions. According to McKinsey, data-driven companies are 1.5 times more likely to report revenue growth of greater than 10%.

Unfortunately, just like much of the population for much of the last 12 months, data is locked down and isolated. MuleSoft’s 2021 Connectivity Benchmark report reveals that data silos and existing IT infrastructure are making it difficult for most firms to integrate new technologies and make changes to IT systems and applications. In fact, currently less than third of enterprise applications on average are integrated, so there is still significant room for improvement. Those organisations that are able to connect the dots between their data stand to realise increased customer engagement, business transformation and innovation benefits.

Journey towards API-led integration

Legacy custom code point-to-point integration may have been fine a decade ago when enterprises ran relatively few applications. But today’s businesses need something altogether more agile. Point-to-point can be expensive and complex, which means IT ends up spending too much of its time on maintenance and not enough on innovation.

This is where APIs come in, offering a more seamless and cost-effective way to drive integration through discoverability, self-service, and reuse. Rather than building the same point-to-point integration for use in 10 different projects, which requires each to be maintained individually as unique sets of code, a single API can be developed to be reused across them all. An API-led approach therefore means companies only have to unlock each data set just once to empower business teams across the organisation to use that data in their own projects.

The value of this approach can be extended even further with today’s low-code tools, which support drag-and-drop integrations. This can help to ease the burden on IT teams and empower business users to deliver their own integration projects.

The LendingTree experience

One company that has driven major improvements through reusable APIs is online loans marketplace LendingTree. Originally its 16 different business units were operating with siloed, incomplete data, meaning 360-degree customer insight was impossible—affecting sales and the end-user experience. The firm was not able to capture or analyse call centre data, limiting its ability to improve experiences for its customers.

Using APIs to draw in data from multiple systems and databases in real-time, LendingTree was able to consolidate its customer data on Salesforce to create a single source of truth for cross-departmental teams. This approach empowers service agents by giving them access to individuals’ loan application history from a single console, drastically reducing the time it takes them to consolidate various sources of customer data. As such, its API-led integration approach has allowed LendingTree to free up time and resources to launch new capabilities faster.

The future’s digital

Organisations have been affected in many different ways by the COVID-19 pandemic. But across the board, the desire among business leaders over the coming months will be to emerge from the crisis stronger than ever. Data-driven insight will be vital to this achievement, as businesses push ahead with digital innovation. API-led integration can help them to ensure that data strategies are long-lasting and sustainable, paving the way for long-term success and a brighter digital future.

 

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