BAT is a common acronym in China’s tech space for a reason. Baidu-Alibaba-Tencent are the three largest firms in the country, and each has its tentacles in a range of products and areas. Now, Baidu has entered the online banking space, becoming the third BAT member to do so this year.
Baidu, best known for its search, mapping and mobile wallet services, has teamed up with Chinese bank CITIC to establish ‘Baixin Bank’. The joint venture is currently awaiting approval for a banking license so there’s no confirmed launch date, but the bank will join other digital offers from Tencent, which launched China’s first private online bank in January, and Alibaba, which saw its MyBank service go online this summer.
There’s a significant differentiator for Baidu, however. That is that the company is working in partnership with an established banking organization — CITIC has some $767 billion in assets — rather than going it alone as Alibaba and Tencent have done.
Baidu said it believes that the hybrid approach will bring out the best of both companies’ expertise.
“This is the first in-depth cooperation between an Internet company and a traditional bank, representing an entirely new model of “Internet + banking” — a bank that truly understands both the Internet and financial services. Together, we will pioneer and build the future of Internet finance,” said Baidu chairman and CEO Robin Li, making a sly dig at his rivals.
Chang Zhenming, chairman of CITIC Bank, said that the initiative would “better meet the growing needs of ordinary people and small businesses for financial services, helping to create a more inclusive finance, and supporting the development of the real economy.”
That’s the very same focus that Alibaba and Tencent have talked of with their respective banking services. Tencent’s WeBank — which is closely integrated with WeChat, the popular Chinese app with 500 million active users — is designed to offer small businesses better access to credit and micro-financing. While Alibaba said MyBank would serve “the little guys” in China — be that those who have limited access to existing banking systems, and also companies seeking financing.
In an early bid to drum up momentum in this tightly contest space, Baidu has announced a one percent cash-back initiative for its Baidu Wallet service. There’s no time limit on the program, which will give users back one percent of all purchases made using its payment service.