Ant Group plans to divest EyeVerify biometrics in 2021, spooked by US restrictions
Digital service provider Ant Group is selling biometric security firm EyeVerify, also known as Zoloz, amid U.S. privacy concerns regarding Chinese processing of American data that increased under the Trump administration, reports the Financial Times.
“Moving to protect the personal data of Americans will probably continue under President (Joe) Biden for both political and security reasons,” says Roger Robinson, CEO of Washington based research consultancy RWR Advisory Group. However, a senior executive at Ant, said that such data did not leave the smartphones that performed the scans, meaning that neither EyeVerify nor Ant had access to the data.
EyeVerify rebranded to Zoloz after it was bought in 2016 for approximately $100 million, FT reports, though the figure was put closer to $70 million by an observer at the time. FT describes EyeVerify as a subsidiary of Ant-owned Zoloz Global, but its LinkedIn and web home pages redirect to Zoloz.com.
Zoloz’ eye biometrics-based presentation attack detection (PAD) technology was confirmed to meet the ISO/IEC standard for liveness technologies last year by iBeta.
The company’s software is currently used by banks, and leverages a cloud-based identification solution to authenticate user identity through blood vessel pattern recognition in the eye, of which data can then be used in place of a password on mobile services.
In 2018, Ant’s $1.2 billion deal to acquire Texas-based money transfer company MoneyGram was halted over national security concerns. Around 5 percent of Ant’s business is currently outside of China, yet new Chinese regulations for FinTech companies are expected to restrict Ant’s domestic business.
The planned sale has arisen as Ant looks to raise capital, including through a proposed bond issuance, pre-empting potential fines following the company’s failed IPO in 2020. The bond issuance could raise up to $8 billion, helping the company to expand out of China, according to the Financial Times, but it was initially planned to happen in early January, and the delay has prompted speculation that the plans may be changing.
Ant’s dual listing in both Hong Kong and Shanghai was suspended by Chinese regulators before its launch in November, though it was set to become the world’s largest ever share offering.