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There is much that India’s financial regulators, besides financial technology companies, can learn from Ant Group Company’s forthcoming mega initial public offering. Ant, spun off from parent Alibaba, China’s giant ecommerce platform that handles business-to-business and business-to-consumer sales, in 2011, will raise more than $30 billion, dethroning Aramco, the Saudi oil giant as the company to have managed the biggest IPO, and achieve a valuation in excess of $300 billion. That is comparable to the market cap of JP Morgan Chase, for example.
Ant has, broadly, four different business divisions: payments, credit, investment distribution and insurance distribution. It does offline payment, online payment and deferred payment on the lines of a credit card. It gives consumer loans and processes small business loan applications for banks. Reportedly, it processes 3,000 data points in about three minutes to sanction or decline a loan request. Alibaba’s sales yields multiple kinds of real-time data: company turnover, customer profile, customer lifestyle and spending power, supplier volumes and sales, customers’ customers, and so on. Past loanservicing behaviour, network of transactions, solidity of commercial interlocutors, and other data can be processed, along with all kinds of external data to arrive at credit decisions. It sells investment products.
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