Banking regulators in east China's Zhejiang Province have confirmed that Alibaba Group, the country's largest e-business operator, is planning to establish a commercial bank and has won the support from local government, according to recent reports from China National Radio.

"Alibaba's plan to set up a new commercial bank is awaiting approval from the People's Bank of China and China Banking Regulatory Commission," said an official from Zhejiang Banking Regulatory Bureau.

Insiders from Alibaba Group disclosed that the central bank and the regulatory commission have approved the group's micro-loan business.

Zhang Peng, chief editor of Business Value magazine, said that the IT companies have been gaining influence on banking institutions.

He predicted that the power of the Internet will play a bigger role if Alibaba finally establishes its own banking branch.

Alibaba has abundant transaction information for small and medium-sized enterprises doing business on the Internet and thus has unique advantages in this sector, Zhang said.

As to the public doubt about whether Alibaba's Alipay will be included in the group's new commercial bank, he said that although the payment business of the new bank and Alipay are likely to be independent, enormous data from Alipay will add to the bank's competitiveness.

By People's Daily Online