JAKARTA -- Ant Financial Services, the payments affiliate of Chinese internet giant Alibaba Group Holding, announced Wednesday a push into Indonesia by establishing a joint venture with local media conglomerate Elang Mahkota Teknologi.
The joint venture will develop a mobile payments service for BlackBerry's BBM chat app, which still claims more than 60 million users in Indonesia. Elang Mahkota Teknologi, known locally as Emtek Group, has been developing the app to cater to the Indonesian market after striking a licensing deal with the Canadian software company in 2016.
The JV deal gives Ant Financial access to a large but heavily regulated market, in addition to Emtek's portfolio of startup investments including e-commerce service Bukalapak. Emtek Group will be able to tap the expertise of Ant Financial, which operates the Alipay global mobile payments platform boasting 450 million users.
"Ant Financial has proven its expertise in providing payment and financial services solutions to the massive and growing [base of] mobile device users in China and developing its partners globally," said Alvin Sariaatmadja, CEO of Emtek. "We are keen to replicate that success in Indonesia."
Emtek investment arm Kreatif Media Karya will hold 61% of the joint venture company, named Elang Andalan Nusantara, a stock exchange filing shows. A spokesperson for Emtek declined to comment on the value of the investment in the venture or members of the management team.
Ant Financial has been investing heavily outside China in a bid to create a global network of online payments platforms. The company invested in the financial technology unit of Thai conglomerate CP Group in 2016, and more recently announced a $200 million investment in the mobile payments subsidiary of South Korean messaging platform giant Kakao Corp.
The company's entrance into Indonesia will fuel further competition in the mobile payments industry in Southeast Asia's largest economy, where less than half of the population owns a bank account. Ride-hailing operators like Grab and Go-Jek have been investing heavily in electronic wallet services amid a rapid rise in smartphone ownership.