Ant Financial, the digital payments arm of Chinese e-commerce giant Alibaba, has agreed to buy US money transfer company MoneyGram for $880m. With more than 680 million active users, Ant Financial is one of the world’s biggest financial technology companies. While Ant Financial has historically been used almost exclusively in China, MoneyGram is a more globalised business, with over 350,000 outlets in nearly 200 countries. The acquisition marks a significant step forward for the fintech giant as it looks to expand its operations overseas.
“The acquisition of MoneyGram is a significant milestone in our mission to bring inclusive financial services to users around the world”, said Eric Jing, CEO of Ant Financial, in a statement confirming the acquisition.
While Ant Financial has historically been used almost exclusively in China, MoneyGram is a more globalised business
“We believe financial services should be simple, low-cost and accessible to the many, not the few. The combination of Ant Financial and MoneyGram will provide greater access, security and simplicity for people around the world to remit funds, especially in major economies such as the US, China, India, Mexico and the Philippines.”
China’s Ant Financial has been expanding its global presence of late. The digital finance firm owns a substantial stake in India’s leading mobile payment provider Paytm, which has seen a 700 percent increase in overall traffic since the country’s demonetisation of its currency in November 2016. Daily transactions on the Paytm app have now reached 500 million per day. Similarly, the Chinese firm has recently partnered with Thailand’s e-payments service, Ascend Money, which operates in the south-east Asian nations of Indonesia, the Philippines, Vietnam, Myanmar and Cambodia.
The deal comes as President Trump’s newly assembled administration moves towards a protectionist economic policy, focused on ending the outsourcing of jobs. Ant Financial has insisted, however, that MoneyGram will remain headquartered in Dallas, Texas, and has pledged that it is “committed to continuing to invest in MoneyGram’s workforce and growing jobs in the US.”
In December 2016, Alibaba founder Jack Ma met with Trump at Trump Tower in order to discuss the creation of US jobs. The Chinese business mogul told reporters that his company would create a million US jobs by allowing SMEs to sell US goods to Asian consumers through the Alibaba platform. While the MoneyGram acquisition still requires regulator approval, Jack Ma’s job creation promise may ultimately prove influential to the regulators’ decision.