Ant Fi­nan­cial pushes ru­ral fi­nance ser­vice

China Daily (Hong Kong) - - BUSINESS - By OUYANG SHIJIA ouyang­shi­jia@ chi­

Ant Fi­nan­cial Ser­vices Group, Alibaba Group Hold­ing Ltd’s fi­nan­cial-ser­vices af­fil­i­ate, has ramped up its ex­pan­sion in ru­ral fi­nance — with the com­pany an­nounc­ing on Tues­day that it will pro­vide so-called ac­quain­tance­based loan ser­vices, big databased on­line loan ser­vices and sup­ply chain fi­nanc­ing for the ru­ral pop­u­la­tion in China.

Ac­quain­tance-based loan ser­vices is a new model cre­ated by Ant Fi­nan­cial for ru­ral fi­nanc­ing, in which it screens loan ap­pli­cants with lit­tle or no con­ven­tional credit his­tory by talk­ing to their of­fline business part­ners, cus­tomers and even other peo­ple in the vil­lages.

Ant Fi­nan­cial said the move ac­cords with a com­pany strategy to boost eco­nomic growth in ru­ral ar­eas and the Hangzhou-based in­ter­net fi­nance ma­jor has set an am­bi­tious goal to lend about one tril­lion yuan ($143.89 bil­lion) to ru­ral cus­tomers in the next three years.

Work­ing with 100 lead­ing agri­cul­tural en­ter­prises, the com­pany said it would of­fer pay­ment, credit, in­sur­ance and other fi­nan­cial ser­vices in 1,000 coun­ties in China over the next three years.

Yuan Leim­ing, vice-pres­i­dent of Ant Fi­nan­cial, said the com­pany is will­ing to sup­port China’s agri­cul­tural trans­for­ma­tion and up­grad­ing.

“Agri­cul­ture is in ur­gent need of a huge amount of in­vest­ment. As progress moves for­ward in other in­dus­trial sec­tors, we should bet­ter sup­port the devel­op­ment of agri­cul­ture,” said Yuan.

An­a­lysts said the ini­tia­tive can be a turn­ing point for the agri­cul­tural sec­tor.

“There are huge op­por­tu­ni­ties for China’s ru­ral and agri­cul­tural devel­op­ment. And fi­nance will play a sub­stan­tial role in pro­mot­ing the process,” said Bei Duoguang, pres­i­dent of the Chi­nese Academy of Fi­nan­cial In­clu­sion at Ren­min Univer­sity of China.

“In the fu­ture we should not build a com­pletely new fi­nan­cial sys­tem, but to help the cur­rent sys­tem to be­come a fi­nan­cial in­clu­sion sys­tem,” Bei added.

Ac­cord­ing to a white pa­per re­leased by China’s State Coun­cil In­for­ma­tion Of­fice in October, by the end of 2015, China still had 832 im­pov­er­ished coun­ties and the num­ber of ru­ral poor reached 55.75 mil­lion.

Qin Weim­ing, deputy di­rec­tor gen­eral of the depart­ment of fi­nance at the Min­istry of Agri­cul­ture, said that ru­ral fi­nance would help pro­mote agri­cul­tural mod­ern­iza­tion.

“With the positive pol­icy from the gov­ern­ment and the en­thu­si­asm of re­lated or­ga­ni­za­tions, it is the best time for all par­ties to reach a com­mon con­sen­sus and then solve ru­ral prob­lems,” Qin said.

In the past two years, the Min­istry of Agri­cul­ture worked with Ant Fi­nan­cial to di­rectly con­nect new farm­ing op­er­a­tors with in­sur­ance in­sti­tu­tions through an in­ter­net plat­form. They plan to add more func­tions to the sys­tem, such as pro­vid­ing agri­cul­tural poli­cies.

The com­pany also an­nounced on Tues­day that it has be­come the sec­ond­largest share­holder of CFPA Mi­cro­fi­nance Man­age­ment Co Ltd, one of China’s big­gest mi­cro­fi­nance play­ers. And it will es­tab­lish a joint ven­ture com­pany with China United In­sur­ance Hold­ing Co Ltd, pro­vid­ing in­te­grated fi­nan­cial ser­vices for grow­ers and cul­ti­va­tors at lead­ing agri­cul­ture en­ter­prises in the main­land.

Agri­cul­ture is in ur­gent need of a huge amount of in­vest­ment. As progress moves for­ward in other in­dus­trial sec­tors, we should bet­ter sup­port the devel­op­ment of agri­cul­ture.” Yuan Leim­ing, vice-pres­i­dent of Ant Fi­nan­cial


A man helps a farmer in Lu­tong county, Zhe­jiang prov­ince, use fi­nan­cial-ser­vices pro­vided by Ant Fi­nan­cial un­der Alibaba Group Hold­ing Ltd.

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