As Ant Group Saturates Its Home Market, Overseas Expansion Becomes Priority

By Hu Yue, Qian Tong, Zhang Yuzhe and Anniek Bao

Ant Group’s headquarters in Hangzhou, East China's Zhejiang Province, on July 23.

Financial services giant Ant Group is intensifying efforts to expand overseas, as it scrapes its head on the ceiling of the domestic market, as part of a plan to broaden revenue streams and secure more than 1 billion users overseas by 2025.

The company, which removed its home province of Zhejiang from its official name in June, has been talking a big game about global growth since it last year added internationalisation to its three business growth pillars — alongside digital payments, financial services and technology.

Ant’s strategic investment in India’s answer to its own Alipay, Paytm, seems to have been a largely successful step in this direction, as the company has mimicked Ant Group’s model of combining financial management, e-commerce, insurance, and built-in mini programs.

Since Ant Group invested in the company two years ago, it has become India’s largest mobile payment service provider with 200 million users and more than 11 million daily transactions, a tenfold increase. This has not translated into a profit, with Paytm recording a 42.1 billion rupee ($562 million) loss in the last financial year.

In 2019, Ant Group acquired British firm WorldFirst to develop online international money transfer services.

However not every attempted overseas tie-up in this often-sensitive space has been a success. A failed attempt to acquire American money transferring agency MoneyGram International that ended in 2018 cost Ant a year of waiting and a $30 million compensation fee.

The latest reshuffle at the top last year, when CEO Jing Xiandong stepped down, marks another step for Ant’s revamp of its global business. Jing, who retained his position as director, will now primarily oversee global operations, according to a letter to staff seen by Caixin.

Ant Group has 900 million Chinese users and wants to have 2 billion customers worldwide by 2025, half outside its home market.

Yet the likelihood of success is still shrouded in uncertainty, according to a Citic Securities report, including cultural and language barriers, the shortage of infrastructure in less-developed regions, and regulatory hurdles imposed on the financial sector.

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Contact editor Joshua Dummer (joshuadummer@caixin.com)