Alibaba Group, a China-based e-Commerce giant, has revealed its plans to expand its business into banking sector.
The move follows on the heels of the retailer’s recent announcement about plans to offer an initial public offering (IPO) in the US that is expected to be worth over $16bn.
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The Alibaba subsidiary is a majority shareholder at a local fund management firm and is currently preparing base to create a private bank.
According to Alibaba Group executive vice chairman Joe Tsai, in five to ten years they are still going to be an e-commerce business, but the kind of things they sell on their platform will be a lot more diverse than just physical products.
Customers will buy mutual funds using Alibaba mobile applications, safeguard homes with Alibaba insurance, and will use Alibaba virtual credit cards to order goods from US websites, Tsai said.
"We want to provide financial services to our customer base because we see that as an extension of what we do.
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By GlobalData"We hope that we can make changes to the financial system in China. As you know, the financial system in China is a little bit antiquated," Tsai added.
