The board of directors at China Citic Bank has decided to join forces with Chinese search engine giant Baidu to set up direct banking. China Citic Bank said on Tuesday it will invest RMB two billion (USD 313.7 million) to establish the Baixin Bank Corporation. China Citic Bank will hold a majority stake in the direct bank. China Citic Bank has resumed trading today, not long after it suspended the trading of its stocks on Monday.
Baidu has started to get involved in internet financing. It will be able to offer financial products based on its search engine service. An insider at Baidu Finance said that Baidu has a long history in SME (small and medium-sized enterprises) search data and along with other credit data, and is equipped to provide micro loans to small enterprises, Security Times reports.
Analysts say it is a strategic move for Baidu to explore internet finance when other Internet giants are already ahead of the game. Webank, an online bank which is 30% owned by Tencent, was established in January, while Mybank, an online bank which is 30% owned by Alibaba-backed Ant Financial, was established in June.