JD.com, the large Chinese online retailer, has announced that they are spinning off their finance business for $2.1 billion. The new group will be called JD Finance and will help to start a rival to Ant Financial which is owned by Alibaba.
Chinese businesses are finding a new avenue for success with payment services and other online products that cater to their emerging digital savvy middle class.
As The New York Times explains,
“Along with its core payment platform for consumers and companies, JD Finance is venturing into credit scoring and loans. It has teamed up with China UnionPay, the state-backed financial company, to work on online payments, credit cards and rural financing programs. The spinoff will allow JD Finance to move more aggressively. A separate payments business, with only Chinese investors, can apply for certain financial licenses, enabling JD Finance to offer products that invest in securities and mutual funds.”