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Alibaba Group affiliate Ant Financial Services, operator of Alipay, is looking to expand its operations in the United States with the purchase of biometric security technology company EyeVerify.
The deal marks Ant Financial’s first investment in the US five months after it closed a record US$4.5 billion round of private equity financing, which is the single largest private placement by an internet company.
“The acquisition of EyeVerify is a critical part of our effort to make bold, yet thoughtful moves to continually enhance user trust, safety, and experience,” Jason Lu, the vice-president of fraud risk management at Ant Financial, said in a statement on Tuesday.
Hangzhou-based Ant Financial, which has reached a US$60 billion valuation, is to pay about US$70 million for EyeVerify, a Bloomberg report said, citing a person familiar with the transaction.
EyeVerify will operate as a wholly-owned subsidiary of Ant Financial and continue to be based in Kansas City, Missouri.
Earlier this year, Ant Financial and EyeVerify entered into a licensing agreement in which the US firm’s Eyeprint ID technology was integrated into Ant Financial’s payment authentication platform.
The Eyeprint ID software eliminates the need for traditional authentication methods, such as passwords, by transforming an ordinary selfie into a “key” that protects consumers’ digital footprints, including their mobile transactions.
Lu said the system represents “an important extension of our efforts to accelerate the global adoption of secure mobile payments and allows us to improve our overall risk management”.
A woman uses Alipay for payment on a bus in Hangzhou, capital city of east China's Zhejiang Province.Photo: Xinhua
According to Ant Financial, the proprietary technology is highly accurate, easy to use, and prevents spoof attacks. It can also recognise the difference between a real person and an image or video.
Eyeprint ID contains the visible veins and other unique micro features in and around the eye, and is highly complex and unique to every individual, Ant Financial said.
Those features can never be lost, stolen, or intercepted because the technology scrambles and encrypts the Eyeprint ID data locally – so it never leaves the mobile device of the user.
EyeVerify currently has 17 US patents issued and 15 more patents pending to continue to expand on the technology.
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Toby Rush, the founder and chief executive of EyeVerify, said the company’s payment-grade biometric platform is “already trusted by over three dozen banks and technology leaders, and we look forward to helping even more people across the financial spectrum access digital services with security and convenience”.
“Ant Financial’s vision to turn trust into wealth for small and micro enterprises, as well as consumers worldwide, resonates deeply with our own core mission,” Rush said.
A poster for Alipay at a bus station in Hangzhou, capital city of east China's Zhejiang Province. Photo: Xinhua
Established in October 2014, Ant Financial’s other businesses include online bank MYBank, credit scoring service Sesame Credit, lending marketplace Zhao Cai Bao, mass-market investment vehicle Ant Fortune and Yu’e Bao, China’s largest money market fund.
Ant Financial early last year teamed up with parent Alibaba, which owns the South China Morning Post, to invest US$575 million in Paytm, India’s largest mobile payment services provider.
Paytm offers a wide range of value-added financial services including mobile top-up, utility bill payments, money transfer, movie ticketing and taxi-fare payments to its 122 million users in India as of January.
Total financial technology investments in the Asia-Pacific skyrocketed to a record US$9.62 billion in the January-to-July period on the back of Ant Financial’s oversized funding round in April, according to data from global consulting firm Accenture and venture capital database CB Insights.
(SOUTH CHINA MORNING POST)
