Published Date : Nov 19, 2015
The government in China is now looking to open up its financial services sector. This year, it first launched its pilot program aimed to establish around five private banks instead of focusing on state owned banks. Out of these five private banks, two projects were Alibaba and Tencent. The goal of this project was to help small and medium business (SMBs) to get easier access to loans. To rival this, Baidu too has launched its online bank.
Baidu is often referred as China’s Google has now entered into a partnership with Citic Bank to launch its online bank to compete with its rivals Alibaba and Tencent in the financial services sector. This joint venture will allow the Biaxin Bank pending approval by the banking authority in China with the mission of managing wealth for the people and finance for the public, to provide service to the real economy, and to build an inclusive approach to finance.
Presently, many Internet firms are trying to shake the financial services sector in China. In the beginning of this year, Tencent launched an online bank called WeBank, which was named after its popular chat messenger app called WeChat. Soon, Alibaba followed and launched its online bank called MyBank. However, Baidu stated that its offering will be one of a kind as it will be run by a traditional bank and a major Internet company. Citic Bank is owned by the CITIC Group and has more than 4 trillion renminbi worth of assets. Furthermore, this traditional bank also operations spread over126 cities and close to around 1,300 business outlets. Currently, Baidu boasts of more than 640 million users accessing its search engine per month.
According to the CEO of Baidu, this will be the first in-depth cooperation between a traditional bank and an Internet firm and provide an entirely new model that understands both financial services and the Internet.