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Alibaba’s long-term ambition to grow its business in the US is taking another step forward. To increase sales to US small businesses, the company has partnered with Kabbage, the Softbank-backed unicorn that provides loans to SMBs using big data and machine learning to determine eligibility faster than a traditional bank lender, to provide up to $150,000 of financing at the point of sale on Alibaba.com as part of a new program called Pay Later.

The move comes on the heels of an interesting, if slightly older, piece of news: Alibaba quietly made an acquisition in the US last year to further its interests in the country as it continues to face-off with homegrown competition, with Amazon leading the charge.

In September 2018, with very little fanfare, Alibaba acquired a startup called OpenSky for an undisclosed amount to build out its business in North America.

Alibaba had originally taken a stake in OpenSky in 2015 as a part of a deal it struck for the startup to take over several sites it had tried to establish in the US, without much success.

Now, OpenSky runs Alibaba’s B2B business in North America (branded as Alibaba B2B and headed up by John Caplan, who had been the founder of OpenSky), and it is also the company’s main consumer face in the US, under the OpenSky brand, operating as a marketplace for various third-party merchants, and controlling a selection of the brands that Alibaba had offloaded back in 2015.

“Quietly” is the operative word with this acquisition. It seems the only announcement of the M&A was a post on LinkedIn, with the only media coverage being an edited version of the release on a small publishing blog. Meanwhile, there appears to be no reference whatsoever on OpenSky.com indicating Alibaba’s ownership of it.

While Alibaba is the undisputed king of commerce in Asia, its decision to work with Kabbage for financing in the US — despite loans giant Ant Financial being an affiliate of Alibaba’s — underscores the giant’s current softly, softly approach in North America in the wake of some setbacks.

After failing to create much of a stir — and then offloading — its group of US consumer-focused sites, in 2017 company made a big effort, led by CEO Jack Ma, to woo US businesses to do more on Alibaba, starting with a big event in Detroit and a promise to President Trump that doing business on his site would lead to 1 million new jobs.

Now Ma says that won’t be possible because of the ongoing trade war between the US and China. Meanwhile, its affiliate Alipay’s attempted acquisition of Dallas-based MoneyGram for $1.2 billion got blocked by the US government, citing national security concerns. And its ambitions to go head to head with AWS by way of Alibaba Cloud have also been scaled back.

But while the US has remained an elusive market, it’s nonetheless a huge one where Alibaba wants to be. Considering both the Kabbage deal and the OpenSky acquisition, it seems that Alibaba has decided to take a less direct approach to growth in the US, tapping US-built businesses to do it.

For Alibaba, offering a way to finance purchases is an essential component of courting small and medium businesses, who may not always have a large amount of working capital at hand to reinvest in equipment and other business services. The high $150,000 limit is a signal that this is not about buying small office supplies but making larger purchasing commitments.

“We recognized an opportunity to give our customers a convenient financing solution that allows them to improve their cash flow at competitive rates, so they can have the cash they need to grow their businesses,” said Caplan in a statement. “We are delighted to be partnering with Kabbage to empower our SMB customers to source at greater volumes, or improve their cash flow to invest in other areas of their businesses.”

On the part of Kabbage, appearing as a option at the point of sale is an obvious next step for a loans company, as it helps Kabbage connect directly with businesses looking access to cash (one of the key reasons for loans being to buy goods for a business to run). The loans are constructed to be repaid over six months with interest rates starting at 1.25 percent.

Point of sale financing services like Pay Later aim to compete against other options that SMBs have when they are making larger purchases. In the case of Alibaba, other options include paying by credit cards, money transfers, and e-checking. Pay Later will be the only one of these that is free to use (in that Alibaba itself won’t charge a transaction fee) after March of this year. It’s also potentially one of the faster options for completing the transaction if you don’t have immediate access to cash.

“When you are at the point of sale, you’re not going to stick around 48 hours waiting for a loan approval,” said Kabbage CEO and co-founder Rob Frohwein about the service.

Frohwein added that it had been working on a pilot of the service since the middle of last year and that Kabbage is Alibaba’s only partner for the service.

We asked and he confirmed Alibaba has not invested in Kabbage as part of the deal — both have a common investor in the form of Softbank — and that they are not disclosing any financial terms of the arrangement. He also confirmed that Kabbage is likely to seek further equity funding in the near future.