Ant Financial, the fintech company affiliated with Chinese e-commerce giant Alibaba, is continuing its global expansion. The firm has taken its first official step into Indonesia today after it announced a joint venture to develop local financial services.
The company has partnered with conglomerate Emtek, Indonesia’s second largest media firm and an investor in -major e-commerce player Bukalapak, to enter Indonesia, which is Southeast Asia’s largest economy and home to a population of 250 million people.
The initial fruits of this tie-in will be payment platform that debuts on BBM, the BlackBerry-owned service. All but forgotten in most of the world, it remains the dominant chat app in Indonesia with an impressive 63 million monthly users. Beyond its popularity, BBM is operated in Indonesia by an Emtek subsidiary, too, so there are plenty of links.
At this point, it isn’t clear what other services it will be available on. Ant Financial and Emtek said somewhat vaguely that its service would be offered for “e-commerce, over-the-top (OTT) and online-to-offline (O2O) services, merchants and platforms in Indonesia.”
Emtek will look to use its strategic assets, which include two national TV networks, publishing platforms, and other online and e-commerce interests, to help the JV and its services gain national attention.
This partnership is part of a series of expansions that Ant Financial has undertaken to expand its business beyond China, where its products such as Alipay and digital banking reach some 450 million users. It invested $200 million into a similar fintech joint venture in Korea, and has comparable alliances in the Philippines and Thailand. Ant Financial is also bidding to buy U.S.-based cross-bordering remittance firm Moneygram, but the company is also considering a bid from rival payment operator Euronet.
Elsewhere, Alibaba is getting serious on e-commerce in Southeast Asia. The firm acquired a majority stake in regional player Lazada last year, it is negotiating the terms for a full acquisition and recently announced plans for a regional cross-bordering logistics hub in Malaysia. E-commerce as a whole in the region is tipped to grow from $5.5 billion in 2015 to $87.78 billion in 2025, according to a report authored by Google and Singapore-based investment firm Temasek last year. Indonesia alone is forecast to account for $46 billion of that 2025 figure.