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business Wednesday 28 OctOber 2020
Here's why Ant Group is about to shatter IPO records

By ZEN SOO him the wealthiest person
AP Technology Writer in China, with a fortune
HONG KONG (AP) — Stel- estimated at $58.8 billion
la Su, who lives and works according to the Hurun Re-
in Shanghai, has used an search Institute, which fol-
ATM only once in the past lows the country's wealthy.
year. Instead of cash, in Alipay was created in 2004
recent years she has done to serve as an escrow ser-
almost all her business using vice between buyers and
the digital wallet Alipay –- sellers on Alibaba's e-com-
shopping in a mall, buying merce consumer platform
stuff online or transferring Taobao. It held funds from
money to friends. buyers to be released to
"Now when I go out, I don't sellers after goods were
even need to carry my wal- received. Alipay's revenue
let, all I need is my phone," mostly comes from trans-
said Su, one of over a billion action fees charged to
Alipay users in China and merchants. Users can link
abroad. their bank cards directly to
Alipay, operated by Ant Alipay to top up their wal-
Group, is the world's largest lets, and transfers can also
and most valuable finan- be withdrawn from users'
cial technology (fintech) In this Friday, Oct. 23, 2020, photo, the figure of the Ant Group's mascot is displayed at the office bank accounts.
company and one of two in Hong Kong. One of those is Zhima Cred-
dominant Chinese digital Associated Press it – -a private credit-scoring
wallets in China, the other with a valuation of $150 one," said Shaun Rein, mo app is used in the U.S. system that rates the trust-
being rival Tencent's We- billion after a 2018 fund- founder and managing di- "Ant Group is so valuable worthiness and creditwor-
Chat Pay. raising round. "Ant Group rector of China Market Re- because Alipay is used on thiness of its users based on
Thanks to the huge scale is much more than PayPal search Group in Shanghai. a day to day basis by a bil- data such as whether users
and potential of China's fin- which only processes finan- "On the Alipay platform, lion people on all of their pay their bills on time via
tech landscape, Ant Group cial payments. It has a lot you pay for things, you buy purchases," said Rein. "The Alipay. Zhima Credit scores
is poised to raise about of businesses in other ar- insurance, you buy wealth scale of fintech in China can help people take
$34.5 billion in the world's eas and with other services management. Your whole dwarfs the regular finan- out small loans from Ant
largest share offering, that would help 1.3 billion life revolves around Alipay." cial transaction potential Group's consumer credit
beating Saudi Aramco's people in China," Jackson Walk into a supermarket in the United States." Alipay services Huabei and Jiebei
previous record of $29.4 bil- Wong, asset management in China and one would evolved from e-commerce to finance such things as
lion. Ahead of the IPO, the director at Amber Hill Capi- be hard-pressed to find a giant Alibaba, which was iPhone purchases or school
company will be valued at tal Ltd., said in an inter- customer digging around founded by Jack Ma in expenses. Such loans are
about $280 billion. view. "We are betting that for loose change to pay 1999 to help match buyers hugely popular in China,
To tap both Chinese and Ant Group will be able to for groceries. Instead, ca- and sellers in China's fast where credit card usage is
global investors, Ant Group grow at a very high pace shiers scan a QR code on a growing market. When Al- low and most people have
is listing its shares both in in the future." Alipay and customer's smartphone to ibaba launched consumer no official credit history and
Shanghai and Hong Kong. WeChat Pay have helped deduct money from their e-commerce platform Tao- are unable to borrow from
It is due to begin trading in make Chinese society virtu- Alipay or WeChat Pay digi- bao to rival eBay in China, banks. Ant Group's money
Hong Kong on Nov. 5. The ally cashless, at least in big tal wallets. The transaction Alipay was introduced as a market fund, called Yu'e
Shanghai debut has yet to cities, with consumers and takes seconds. payments method to boost Bao -– one of the world's
be announced. merchants alike relying on In restaurants, groups of users' trust in the platform. largest –- lets people put
Even before announcing digital payments using their friends often split the bill by Today, Alipay's reach ex- idle cash in their Alipay
its IPO plans, Ant Group phones. "Think of Alipay as transferring money to each tends to almost every as- wallets to work and reap
was the world's most valu- Visa, MasterCard, Citibank, other using their digital wal- pect of life related to mon- returns on investments as
able fintech company, Fidelity… all rolled up into lets, similar to how the Ven- ey. Ma's foresight has made small as 100 yuan ($15). q

Cloud growth helps Microsoft beat Wall Street expectations

REDMOND, Wash. (AP) — the July-September period, Xbox gaming system.
Microsoft reported quar- up 12% from last year. Ana- The company's growth was
terly earnings Tuesday that lysts had been looking for led by its commercial cloud
beat Wall Street expecta- revenue of $35.8 billion, ac- segment, which grew 31%
tions, as it continued to cording to FactSet. from the previous year to
weather the coronavirus The software giant has ben- generate $15.2 billion in
pandemic amid increased efited from a COVID-19-fu- revenue, said Amy Hood,
demand for its flagship soft- eled trend of working and Microsoft's chief financial
ware and services. learning from home that officer.
The company reported fis- boosted demand for its Revenue from the compa-
cal first-quarter profit of cloud computing services ny's Xbox content and ser-
$13.9 billion, or $1.82 per and workplace productiv- vices grew 30% as the com-
share, beating Wall Street ity products, such as email pany next month prepares
expectations of $1.54 a and video conferenc- to launch its first new con- In this May 7, 2018, file photo Microsoft CEO Satya Nadella
share. Microsoft posted ing. It's also experienced sole since 2013. Preorders delivers the keynote address at Build, the company's annual
conference for software developers in Seattle.
revenue of $37.2 billion in heightened demand for its began in September.q Associated Press