CHINA Minsheng Banking Corp. said yesterday that it had agreed to team up with e-commerce giant Alibaba Group Holding to provide financial services.

    Minsheng, the country’s 10th-largest bank and the biggest that isn’t State controlled, said the cooperation with Alibaba will cover wealth management business, credit card operations, electronic banking and information technology.

    The move marks another step into electronic banking for Alibaba, a firm that has signalled its growing ambitions in moving further into financial services. It also lets Minsheng, which has targeted smaller customers as part of its expansion strategy, tap into Alibaba’s big customer base.

    Minsheng will issue special wealth management products catering to users of Taobao, Alibaba’s online marketplace. Minsheng will open a store on Taobao to sell products online.

    Minsheng said direct banking accounts of its customers could be linked with accounts under Alipay, an online-payment affiliate of Alibaba.

    The bank also cited Alibaba Small and Micro Financial Service head Peng Lei as saying in a statement that this was a first step in their strategic partnership to serve small enterprises and “grassroots” customers.

    In June, Alipay began allowing users with money stored online to directly invest in a fund focused on corporate debt and government bonds. It had raised more than 6.6 billion yuan (US$1.08 billion) by early July, the company said.

    Alibaba has already been lending to small and medium-sized enterprises for the past three years, and has said it expects to have a loan book of about US$2 billion by the end of 2013.

    In a June commentary in the People’s Daily, Alibaba chairman Jack Ma said China’s financial regulations are “excessive” and that Internet companies should play a key role in financial reforms.

    Minsheng’s strategy of lending to smaller customers has given it a market niche in a banking system that is dominated by State-owned banks that tend to favor large State customers. (SD-Agencies)