Alibaba in Europe: Ant Financial takes stake in Swedish fintech app Klarna

09/03/2020

Ant Financial has embarked on a series of moves to tap European consumers. Tencent is is also looking to expand into Europe

 

Ant Financial is investing in Europe. Alibaba’s fintech arm, bought a small stake in Swedish payments app Klarna, said on Wednesday the european startup. The investment accounts for less than 1% of Klarna’s equity and was comprised of existing and new shares, Reuters reported citing inner source.

Recently Ant Financial has embarked on a series of moves to tap European consumers, as the Chinese online payments market is effectively saturated by the WeChat Pay and Alipay duopoly. Last year, Ant Financial already announced a partnership in November with French startup Worldline to bring Alipay into Europe to provide payment services to Asian tourists. According to media, another six European mobile wallet platforms, together accounting for 5 million users, are partnering with Alipay to offer payment services on the continent. 

By the way, Tencent is also looking to expand into Europe, which is becoming a new arena for competition between China’s biggest apps. In 2018, Tencent led the Series B of German online bank N26, which raised $160 million. In January 2020, it led another Series B, this time for French digital payments app Lydia, which raised $45 million. 

According to Sebastian Siemiątkowski, Klarna CEO, “Alipay, and the wider Alibaba Group, have truly set the global pace on retail innovation and the app economy. We are delighted in this confidence shown in Klarna in defining the future of payments and shopping.” Founded in 2005, Klarna is valued at $5.5 billion. According to the Financial Times, Klarna’s investors include global payments provider Visa, New York investment firm BlackRock, and venture capital group Sequoia Capital.

The European company says it is powering 200,000 retailers around the world, including big names such as H&M, Asos, Expedia Group, Ikea, Farfetch, Adidas, Spotify, Samsung, and Nike. It also counts 80 million customers globally, and “has more than 200,000 more monthly app downloads than the nearest US competitor.” In 2019, Klarna’s revenue increased by one-third on an annual basis to $740 million. But a push into the US market and heavy credit losses led to a net loss, according to the Financial Times.

 

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