Kakao Pay, Kakao’s new fintech subsidiary, to strategically broaden its digital financial services for local consumers
Kakao Corp., South Korea’s leading mobile platform company best known for its messaging platform Kakao Talk, today announced that Ant Financial Services Group, one of the world’s leading digital financial services providers and parent company of Alipay, a global mobile payment platform, will invest $200 million in Kakao Pay Corp. (“Kakao Pay”), Kakao’s soon-to-launch mobile finance subsidiary.
The investment is part of a larger strategic partnership agreement, as Ant Financial currently boasts over 450 million users worldwide, and will bring new digital financial innovations to South Korea through Kakao Pay, which serves as the country’s premier mobile finance platform.
Kakao’s board decided in January to form a separate entity for its Kakao Pay financial service brand, tentatively named Kakao Pay Corp. Young-Joon Ryu, who currently leads Kakao’s fintech division, will head the new company. Under Ryu’s leadership, the Kakao Pay platform has accumulated more than 14 million members, and the platform evolved from payment transactions to offer innovative and convenient mobile financial services including bill payment, remittance and membership management.
Ant Financial will offer its wide range of digital financial services through Kakao Pay in South Korea. The new company will increase the number of online and offline merchants by merging Alipay’s 34,000 merchants into Kakao Pay’s system providing merchants a much larger customer base. Kakao Pay plans to expand its online and offline payment coverage for South Korean users, and in the future, users can enjoy seamless and secured payment experience on e-commerce marketplaces powered by Alibaba Group. Chinese visitors and tourists will continue to enjoy a broader payment experience in South Korea with Alipay, and Kakao Pay users will enjoy more digital financial services provided by the growing global footprint of Ant Financial.
Ant Financial provides a wide range of digital financial services to over 450 million users in China and beyond. Through Alipay, users can hail a taxi, book a hotel, buy movie tickets, pay utility bills, make appointments with doctors, or purchase wealth management products directly from within the app. The strategic partnership between Kakao Pay and Ant Financial aims to bring comprehensive digital financial services to Kakao’s 48 million plus users, leveraging the strength of Ant Financial in mobile payment, risk control, cloud computing and innovative financial services.
“South Korea is an important market for Ant Financial in its global expansion, and we see many opportunities in the market for innovative services and growth in mobile payments. Given Kakao’s leading mobile platform offering and vast customer base, we believe we can bring Ant Financial’s broad experience in digital payments and technology-driven financial services to offer exciting and innovative products to South Korean customers,” said Douglas Feagin, President of Ant Financial International.
“The combination of Ant Financial’s global payment platform Alipay and numerous financial and commerce service networks and Kakao’s platform capabilities will result in more effective and convenient financial solutions for both businesses and consumers,” added Young-Joon Ryu, Kakao Pay’s CEO-elect.