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Alibaba spin-off Ant Financial gets $4.5b funding as China’s payments war escalates

Alibaba spin-off company Ant Financial, which runs China’s top mobile payments app, today revealed it has secured a gargantuan US$4.5 billion in series B funding. The investment amount is substantial even at a time when billion-dollar funding rounds are increasingly common among giant startups like Uber and Didi Kuaidi.

Indeed, Ant Financial’s US$4.5 billion is the biggest ever funding round in consumer tech history.

Ant Financial’s mobile wallet app Alipay shown after being used to pay for coffee.

Ant Financial runs the Alipay mobile wallet app, which has over 450 million monthly active users. It can be used for online shopping, in-store cashless payments, buddy-to-buddy transfers, an online personal wealth fund, insurance, and several other features. It also operates the online-only MYbank.

Alipay is up against WeChat’s mobile wallet as well as Apple Pay.

Funded af

“This new round of funding will support Ant Financial in its goal to expand access to financial services in China’s rural areas, while also fuelling the company’s globalization,” said the firm in a statement. The investment was led by China Investment Corp Capital and CCB Trust, a subsidiary of China Construction Bank, along with existing investors China Life, China Post Group, China Development Bank Capital, and Primavera Capital Group.

The firm is not included in Alibaba’s listing on the New York Stock Exchange. It wascontroversially branched off from Alibaba in 2011. It has an agreement that gives Alibaba 37.5 percent of Ant Financial’s pre-tax profits – and if Ant Financial does IPO, Alibaba would receive up to 37.5 percent of that windfall.

While Ant Financial is mostly focused on China, it has made steps overseas – most notably in India. It has made two substantial investments in Indian payments startup One97, which runs the Alipay-esque Paytm app. Paytm has 122 million users across India.

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