Alibaba's Jack Ma: “Everyone Should Have a Bank Account.”
‘TechFin’ is a term coined by Jack Ma, the billionaire Chairman of Alibaba Group Holdings. TechFin came about as Ma envisions “everyone should have a bank account”. This vision is similar to that of the bitcoin community — that is, to bank the unbanked. As Ma brings forth his vision, what could be in store for bitcoin?
Also Read: India Encourages ‘Mission Mode’ Digital Currency Adoption
According to the South China Morning Post, Ma referred to ‘FinTech’ as a financial system leveraging technology for advancement. On the other hand, TechFin uses technology to empower the financial system. Ma further emphasized the TechFin’s concept as “what we want to do is to solve the problem of a lack of inclusiveness”.
An Eye on Emerging Markets
Jack Ma, founder of the Alipay platform, wants emerging markets to gain access to capital through the concept of TechFin. Ma revealed that the concept would assist the younger generations, small-scale companies, and developing nations. However, Alipay’s platform alone is not sufficient to bring banking to everyone.
Hence, investments seeking to expand and carry out TechFin’s goal were present. Ant Financial Services Group, backed by Alibaba Group Holdings, invested US$680 million in India’s e-wallet company, Paytm. This investment helped to expand India’s digital financial services overseas.
Additionally, Ant Financial Services Group partnered with Thailand’s Ascend Money, an e-wallet service provider. This partnership will assist Ascend Money to grow its online and offline payments presence.
TechFin Ties in With the ‘War on Cash’
The aftermath of India‘s sudden demonetization has led citizens to embrace a “less cash transactions and an increase in digital currency” idea, said India’s Union Finance Minister Arun Jaitley.
Unable to carry out business in the absence of Rs 500 and Rs 1000 paper bills, the masses in India, such as the fishmongers and their patrons, turned to e-wallet services like Paytm. These people, who make up of the bulk of India’s population, are in fact the drivers behind the boost the e-wallet services in India.
Insecurity Caused Many to Turn to Bitcoin
Apart from using e-wallet services like Paytm as a means to carry out their daily transactions, there is also a huge number of Indian citizens turning to bitcoin. This is the result of insecurity caused by the sudden change in India’s laws. The overall situation about bitcoin in India is about uptrend, due to the lack of faith in the financial system and rules in India.
How Probable is “Everyone Should Have a Bank Account” Without Bitcoin’s Inclusion?
Ma has been aggressive with his ventures into Bitcoin and blockchain technology in the recent years. His countenance for the use of tamper-proof blockchains to record charity platforms’ transactions to defeat scandals and mismanagement is perhaps one of the most notable.
Ma is at the forefront of the FinTech sector. At the same time, Ma is also aware that FinTech is only practicable to areas where the financial giants’ decide to be — the profitable and accessible areas. Having said that, can the concept of TechFin be workable without these giants and/or limitless bitcoin? The answer is debatable.
TechFin- Putting Technology Before Financial System
In line with his belief about TechFin and outreach to the millions of unbanked in the world, Ma has to bring technology to people first. This TechFin’s concept has in fact been put into action before he has coined the term. With Rural Taobao, an ambitious effort by Alibaba Group Holdings, villagers get to buy and sell their produce through the online platform with the help of IT-savvy middlemen and commission fee. This is one of the ways to bring technology to the masses.
Middlemen and additional commission fees is not exactly an ideal method to bring banking to the unbanked. The most cost-effective way to do it is definitely through bitcoin. However, these efforts to introduce technology to the masses is a good start to bridge the technological gap before TechFin can truly surface.
Introduction of Bitcoin is Worth the Wait
Ma is known for his philanthropic ways of dealing with life and business. TechFin is one of his many plans to bring both technology and financial systems to people. TechFin may take many years before it can be called a success.
In many ways, bitcoin enthusiasts can see Ma’s initiatives as subtle promotions for bitcoin — and a gradual one. After all, what good does it do for the underprivileged if Ma were to openly announce the introduction of bitcoin onto Alibaba Group’s holdings, or the companies where it has vested interests, and send bitcoin value to skyrocket before TechFin takes form?
Let us know what are your views about Jack Ma’s TechFin vision in the comments below.
Image Sources: By World Economic Forum from Cologny, Switzerland [CC BY-SA 2.0], via Wikimedia Commons, By Phirun (Own work) [CC BY-SA 4.0], via Wikimedia Commons