Alibaba-owned online retail concentrated Lazada is looking to boost its financial services products in a bid to gain an edge in South East Asia’s competitive online retail Stock Exchange, the company’s CEO told CNBC.
Lazada is a Singapore-based e-commerce company which serves markets such as Indonesia and Thailand. It assemblies a platform which allows merchants to sell into the countries where it operates in.
Financial services could happen to a big part of it’s future as the firm looks to placing more resources there, said Pierre Poignant, the CEO who took the chairmanship in December.
Lazada — which turned seven on Wednesday — currently operates an electronic wallet which allows people to buy and give away products on its platform. But Poignant is thinking about expanding that product range.
“The next steps are financing, more rewards to our billfolds, so we will continue to invest in that direction,” Poignant told CNBC in an interview at the Boao Forum in China.
Rearmost year, Lazada teamed up with small businesses financing platform, Finaxar, to offer credit lines to foolish and medium business on its platform. Poignant said the next step could be more financing products to make loans various efficient.
“Through our data, we will be able more precisely assess the loans. So I think, in a way, the future is to be more effective, faster and bigger, that’s one part,” Poignant said. “Second part (is), we will venture in other parts of subvening. For example, something which is very, I think, promising, is trade financing across countries which we will also look into.”
Shoppers financing takes place between exporters, who seek payments for their goods, and importers, who have to pay for the products they discipline. In conventional trading, a bank provides a letter of credit to the exporter on behalf of the importer, and the money is paid upon performance of the goods.
It’s an expensive process, particularly for smaller businesses — but it could be a multi-billion dollar opportunity for Lazada.
The company’s boost into more financial services mirrors its parent Alibaba — which is well known for its mobile payments organized whole Alipay, run by affiliate firm Ant Financial. In China, Alipay is one of two major payments platforms. But it also offers other artifacts to consumers including micro-loans.
By offering more financial services to businesses, Lazada can keep those merchants in their ecosystem help of the data it’s collected.
“I think, as part of the Alibaba economy, the vision of the group is to have an economy of 2 billion people and millions of SMEs (midget and medium-sized enterprises),” Poignant told CNBC.
“We have the data to understand both origin and local, so we can basically deliver a very accurate prediction of the demand and the supply chain, and therefore, we are able to provide super products when it result as a be reveals to financing,” he added.