Amazon.com (NASDAQ:AMZN) is doing well, with Amazon stock up nearly 50% year-to-date.

Amazon stock trades at a high valuation, and growth is imperative for the company. Amazon recently celebrated five years in India.

India is a very important growth market for U.S. tech companies like Amazon and Facebook (NASDAQ:FB), especially since these companies have minimal presence in China.

And with its recent acquisition of Flipkart, one of the biggest e-commerce startups in India, the country will alsomatter to Walmart (NYSE:WMT).

India ranks #2 globally in smartphone sales and app downloads, ahead of the U.S. And with 1.3 billion people, India has plenty of room for growth.

Amazon is no longer just an online retailer; it is branching out into more and more industries. As I mentioned last year, finance could be next.

Ironically, by pivoting from e-commerce into finance, Amazon would be copying its arch-enemy: Alibaba (NYSE:BABA).

Amazon has invested in three startups in India in recent months, targeting payments, lending and insurance. Let’s look at Amazon’s moves in these three areas and what this means for Amazon stock.

Amazon in India: Payments

Amazon is working to expand Amazon Pay in India.

Last year, Amazon partnered with bus and movie ticketing platforms, food delivery services and Housejoy, a home-services app, enabling it to accept Amazon Pay.

Millions of Indians still lack access to bank accounts and credit cards. In January, Amazon launched a service where customers could top up their Amazon Pay Balance with extra cash when receiving a delivery.

If you don’t have a bank account or card, Amazon Pay Balance is the next best thing.

In January, Amazon revealed that the amount of money on Amazon Pay Balance had increased by 409% year-over-year. Digital payments accounted for 60% of transactions on Amazon India in 2017, with Amazon Pay accounting for 48% of these.

Last month, Amazon invested in ToneTag, an Indian payments startup. ToneTag software enables mobile devices to make and accept payments via soundwaves.

Over 300,000 merchants in India use ToneTag, and Amazon customers will now be able to buy from them using Amazon Pay.

ToneTag is also working on technology that will allow Amazon Prime subscribers in 8,000 restaurants across India to automatically pay as they walk out.

Amazon recently announced another deal with a major McDonald’s (NYSE:MCD) franchisee in India, Hardcastle, which operates 270 restaurants in India. Users will be able to pay for McDelivery with Amazon Pay.

Alibaba began as an e-commerce company but added its own payment service, Alipay. Alipay now dominates mobile payments in China, processing trillions of dollars in 2017.

Amazon in India: Lending

In April, Amazon invested $22 million in Capital Float, an online small-business lending company in India.

Capital Float claims to be the biggest online lender in India, with 80,000 customers across 300 cities. The company wants to add 300,000 more customers this year.

According to Capital Float, small businesses in India face difficulties raising capital, including “restrictive lending policies, inflexible collateral requirements and slow disbursement times.”

Capital Float offers borrowers an alternative. It takes about 10 minutes to apply for a Capital Float loan online and upload financial documents. The borrower will be notified within minutes if the loan is approved, and the funds will be transferred within 72 hours.

Capital Float makes lending decisions based on a merchant’s cash flows and accounts receivable, and does not require borrowers to post collateral.

Capital Float has partnered with Amazon in the past, loaning to sellers on Amazon India.

Amazon India recently announced a new lending initiative. The Seller Lending Network matches Amazon merchants to lenders. It also created Lender Central, a tool for lenders that allows them to see merchant sales data.

Amazon’s move into lending resembles Alibaba’s experience in China.

Some small businesses selling on Alibaba’s marketplaces had difficulty borrowing money, and this was slowing Alibaba’s sales. Alibaba decided to lend to them, using the sales data it collected to make lending decisions. Loans enabled these merchants to do more business on Alibaba’s websites, which fueled Alibaba’s sales.

Amazon in India: Insurance

In May, Amazon invested in Acko, an online-only insurance startup based in Mumbai. According to its website, Acko aims to “make buying and using insurance really effortless.”

Users can insure their cars and motorbikes with Acko. They can also purchase insurance for mobile phones purchased on Amazon in India.

According to PitchBook, Acko was founded in 2016, and the company has 91 to 100 employees. Varun Dua, Acko’s founder and CEO, has co-founded three other companies. He served as CEO of Coverfox, an online insurance broker, from 2013 to 2016.

Unlike traditional insurers, Acko does not have sales offices. This means lower operating costs, and savings which it can pass on to its customers.

By investing in Acko, Amazon is learning from its rival, Alibaba. Alibaba helped launch Zhong An, China’s first online-only insurer in 2013. Zhong An began by insuring returns on Alibaba’s marketplaces but later added other products, including car, health and accident insurance.

Zhong An went public last year and is currently valued at HK$76 billion on the Hong Kong Stock Exchange.

Amazon’s Competitors

Amazon isn’t alone in India, and it will face off against two formidable competitors. It looks like this competition will intensify in the months ahead.

Walmart is purchasing Flipkart, Amazon’s biggest rival in India, although the deal faces intense opposition from small businesses in India, who want to block it. Flipkart will spend an estimated $2 billion battling Amazon for market share over the next 18 months.

Flipkart owns PhonePe, one of India’s biggest payment apps. A few weeks ago, PhonePe claimed 100 million users and $20 billion in annualized payment volume during the month of May.

Both Flipkart and PhonePe plan to offer financial services. Like Amazon and Acko, Flipkart has partnered with Digit, an online-only insurer, to insure mobile phones purchased on Flipkart. PhonePe is looking toward partnering with financial institutions to sell insurance and mutual funds.

Amazon will also face competition from Alibaba and its Indian subsidiary, One97 Communications, which owns Paytm, another payments and e-commerce giant.

As I mentioned in March, Paytm wants to follow Ant Financial and become a “full-stack financial services company, which offers banking, lending, insurance, and payments.”

Last year, Paytm recently invested in CreditMate, a lending startup. In January, it formed a wealth management unit, Paytm Money. In February, it created business units for life insurance and general insurance.

Bottom Line on Amazon Stock

With these moves, Amazon is working to build a long-term presence in India’s financial system. Competition will be tough, but if Amazon stays in this fast-growing market, Amazon stock will benefit.

As of writing, Lucas Hahn did not hold a position in any of the aforementioned securities.