Ant Financial Could Pursue Digital Banking License In Singapore

Ant Financial Services Group might apply for a virtual banking license in Singapore.

“We are actively looking into this opportunity,” Hangzhou, China-based Ant Financial said in an emailed response to questions from Bloomberg News.

The Monetary Authority of Singapore is offering as many as five digital banking permits to non-banks to boost competition. While Ant didn’t reveal if it would pursue a retail or wholesale license, it will be easier for it to obtain the latter.

Ant Financial is worth around $150 billion, making it one of the most valuable private sector FinTech companies in the world. It also owns the world’s biggest money market fund, Yu’e Bao, and a credit-rating system called Sesame Credit. Ant Financial produced a pre-tax profit in the neighborhood of around $200 million, according to Alibaba’s yearly report.

China is offering up to two licenses for a full digital bank,  which can serve all customers and require S$1.5 billion ($1.1 billion) in capital and local control. In addition, there will be another three available for wholesale banks, which foreign firms can run and the capital threshold is S$100 million. OCBC, Southeast Asia’s second-largest lender, has already set up a partnership with peer-to-peer lender Validus Capital Pte. and Temasek Holdings Pte’s venture capital arm on a wholesale virtual banking license, reports said.

Earlier this year, Ant’s SME Services (Hong Kong) Ltd. unit received a permit from the Hong Kong Monetary Authority to operate a virtual bank in the Chinese territory. And in March, Ant launched a banking as a service platform with Jiangsu-based Hoperun Information Technology. The companies said the new banking product dubbed Distributed Core Banking Platform (DCBP) helps financial firms move their business models to customer-oriented models and away from transaction-oriented models. The new banking platform is also designed to help financial firms contend with digital challenges such as distributed development, financial product management and accounting liquidation.