China's e-commerce giant Alibaba today launched an Internet bank which will offer loans to small and medium-sized enterprises (SMEs), a market under- served by major financial institutions.
MYbank, which is 30 per cent owned by Alibaba's affiliate Ant Financial Services, will offer loans of up to five million yuan (USD 800,000), the company said in a microblog post.
MYbank has four billion yuan (USD 654.15 million) registered capital , state-run Xinhua news agency reported. Jing Xiandong, president of Ant Financial, will serve as MYbank's board chairman.
MYbank was one of five new private banks approved by the China Banking Regulatory Commission in late 2014. MYbank's other shareholders include the billionaire-headed private firms like Fosun Group and Wanxiang Group.
Founded by Jack Ma, one of China's richest man, Alibaba was listed on the New York Stock Exchange last year, raising USD 25 billion, in the largest initial public offering in history.
Founded in 1999, Alibaba helps connect exporters in China and other countries with companies in over 190 countries around the world. Alibaba has already forayed into businesses which goes beyond e-commerce and in June 2013 it launched a financial product called Yuebao, an online money market fund.
Easily accessible on smartphones, Yuebao is China's biggest money market fund in terms of assets under management. However, the company reported its first decline in October last year when its net value decreased nearly 7 per cent to 534.89 billion yuan (USD 87.45 billion).
Alibaba, which already accounts for 80 per cent of all Chinese online consumer shopping, has also faced allegations of counterfeits in recent past. Alibaba was sued by the owner of Gucci, Yves Saint Laurent, Puma and other fashion brands earlier this year, alleging that the firm has made it possible for US shoppers to order counterfeit goods in bulk from Alibaba's various websites.