Alibaba Group Holding Ltd.’s finance arm is strengthening its foothold in the insurance business with plans to invest about 1.2 billion yuan ($188 million) in a Chinese unit of Cathay Financial Holding Co.

Zhejiang Ant Small & Micro Financial Services Group Co. is buying a 60 percent stake in Cathay Insurance Co., as the two companies plan to link their systems and enhance cooperation on cloud computing, according to a statement on Monday.

The investment would allow Ant Financial to gain a license to develop insurance products and enter the business faster than by applying for its own license, a person familiar with the matter said, requesting not to be identified because the matter is private. Ant Financial has ambitions to become a dominant online financial services provider, sometimes taking on powerful mainland China state banks on their own turf.

“Ant Financial is probably trying to explore the many opportunities that big data and insurance provide,” said Wang Weidong, an analyst at Internet consultancy iResearch in Beijing. “Ant Financial is taking a much more hands on approach, instead of just being a platform for insurance products.”

More than 200 million users of Ant Financial’s Alipay payment system already manage their wealth via financial products like Yu’E Bao, a money-market fund that pooled 613.4 billion yuan by June 30.

“We look forward to working together in other markets beyond mainland China and Taiwan,” said Cathay Financial’s President Lee Chang-ken. “Allowing Ant Financial to invest will enable us to have a deeper understanding about Internet finance.”

The Chinese company introduced a new application called Ant Fortune in August that lets users buy about 900 fund products from more than 80 Chinese financial institutions.

Taipei-based Cathay Financial, which provides life and automotive insurance and consumer financing, isn’t related to Cathay Pacific Airways Ltd.

–With assistance from Adela Lin in Taipei.