Regulators in the Republic of Korea have approved an internet lending service backed Alibaba's financial spin-off Ant Financial, paving the way for the firm to boost its banking presence outside China, they said Monday.
The new internet-based lender K Bank is backed mostly by Korean firms, including Korea Telecom. Ant Financial is the sole Chinese stakeholder among 20 that has agreed to help establish the new lender but didn't specify how much it has invested nor the new lender's registered capital, they said in a press release.
Ant Financial said the new Korean lender has been granted a banking license, enabling it to take deposits, extend loans, issue credit cards, offer wealth management services and conduct foreign exchange.
K-Bank marks Ant Financial's second banking venture outside China, after Indian payment service Paytm, in which it also has a stake, received a banking license in payment in October.
A spokesperson with Ant Financial told Xinhua on Monday that the company has several similar deals in the pipeline and said its cloud-computing and payment processing capabilities have made it an attractive partner in running internet-based banking outside China.
Back on its home turf, China's three largest internet firms have all waded into the country's state-dominated banking sector by establishing their own banks.
Internet conglomerate Tencent and Ant Financial, on behalf of e-commerce giant Alibaba, have both opened online-based lenders. Chinese search provider Baidu also launched an internet-based bank with China CITIC Bank earlier this month.
Unlike traditional lenders, these new banks don't have a physical presence and instead operate online. Ant Financial and Tencent have also said their banking clientele will consist mostly of small businesses and individuals previously underserved by traditional lenders.
