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Alibaba arm seeks to use police face scans to open bank accounts

[HONG KONG] Alibaba Group Holding Ltd's financial arm is seeking regulatory approval to access the Chinese national police's database so consumers can open online bank accounts with a mug shot.

The financial arm, which operates the PayPal-like Alipay service, is planning to use the Face++ facial recognition system developed by partner Megvii Inc. The idea is that this would allow consumers to set up accounts without having to physically go to a bank, Megvii Chief Executive Officer Yin Qi said in a recent interview.

"In terms of technology, everything has been sorted," said Yin, 27, who dropped out of Columbia University's doctorate program in computer science to co-found Beijing-based Megvii, whose latest round of funding values the company at US$100 million. "We are just waiting for regulators to approve." The plan helps illustrate how Alibaba is joining the likes of Facebook Inc, Google Inc. and Baidu Inc. in embracing biometric technologies and artificial intelligence. Megvii's application uses facial scans held in a Ministry of Public Security database drawn from legal identification files on about 1.3 billion Chinese.

Alipay is owned by Alibaba Chairman Jack Ma's Zhejiang Ant Small & Micro Financial Services Group Co. Ant Financial is supportive to entrepreneurs with innovative ideas and services, the company said in a statement, declining to commenting further.

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Tsinghua Connection The China Banking Regulatory Commission didn't immediately respond to an e-mail query and two calls to its press office went unanswered. Two calls and a fax to the People's Bank of China's press office requesting information about the face scan database went unanswered.

Megvii's Face++ system lets users confirm the identity of a potential customer by matching facial features with those of the police database, without compromising privacy because neither the user nor the company would be able to see the police data, said Yin.

Yin and two Tsinghua University schoolmates founded Megvii three years ago. Megvii, short for Mega Vision, has more than 50 employees - the average age is 25 - and regularly hires interns from the university, Yin said. The company is already using Face++ for employee identification at one of its offices.

Venture Investors The company raised US$22 million in funding in November. Its investors now include Qiming Venture Partners and Innovation Works, the venture capital fund founded by Kai-Fu Lee, the former head of Google's China operations. Lee also sits on Megvii's board.

Megvii is also pursuing facial recognition for marketing and other businesses amid estimates that China's biometric market will climb about 15 percent annually over the next four years, according to Research and Markets.

The three-year-old company is working with banks to create devices and machines that can replace tellers and bank cards, said Yin, declining to name specific banks.

"We hope to create an eye for all kinds of devices," said Yin, who spoke in a Jan 22 interview.