Ant Group has reported a 19% drop in profits as it continues to expand its digital wallet services globally. According to Bloomberg News, the Chinese fintech giant contributed 2.57 billion yuan ($355 million) in profit to Alibaba, which holds a one-third stake in Ant Group. This translates to an estimated 7.7 billion yuan in profit for the December quarter, a significant recovery from the previous quarter’s 92% earnings decline due to an investment loss.
Ant Group’s strategic move to bolster its digital wallet offerings overseas comes amid slowing growth in its domestic market. The company has partnered with at least 25 eWallet platforms to facilitate cross-border payments across Southeast Asia and Europe. Earlier this month, Ant Group announced plans to expand the use of its Alipay+ payments product, which allows international visitors to China to use their native mobile payment apps.
Douglas Feagin, Senior Vice President of Ant Group, highlighted the demand for home-country eWallets when traveling abroad: “People want to use their home e-wallets when they travel abroad. So they don’t want to have to load their card into another app that they don’t know as well,” Feagin told CNBC. “We see a huge opportunity for expansion and the relatively broad coverage we have in Asia — we [would] like to replicate in places like the Middle East, Latam, and Europe.”
Ant Group has also launched a cross-border payments initiative aimed at boosting tourism and commerce in Hong Kong. This platform supports transactions from users of 14 overseas mobile wallets and bank apps from nine countries, including Mongolia, Malaysia, Macau, Italy, and Singapore. These platforms are now accepted by over 90% of local merchants in Hong Kong, mirroring the widespread acceptance of Alipay in mainland China.
PYMNTS reported that this integration aims to streamline payment processes, enhance operational efficiency, and elevate service standards in Hong Kong’s retail sector. Additionally, in April, Ant Group launched “International Consumer Friendly Zones” in China to improve the experience of international visitors and foster business for local merchants in major tourist destinations.
Despite the profit decline, Ant Group’s strategic global expansion of its digital wallet services demonstrates its commitment to leveraging fintech innovations to meet the evolving needs of consumers and businesses worldwide.