China will reportedly break up Ant Group’s Alipay and force creation of new loans app

The Ant Group Co. headquarters in Hangzhou, China, on Wednesday, Jan. 20, 2021.

Qilai Shen | Bloomberg | Getty Images

Beijing plans to interrupt up Ant Group’s Alipay and kind a separate app for the fintech wide’s loans industry, based mostly on a Monetary Occasions file on Monday.

Regulators beforehand ordered Ant to sever up the companies of AliPay from lending companies Huabei and Jiebei. They now prefer the credit companies to be sever up into an self reliant app as effectively, based mostly on the FT.

Constant with the thought, Ant will turn over user information underpinning loan choices to a brand fresh credit scoring joint project, the FT reported, citing of us accustomed to the course of. The JV will most definitely be partly divulge-owned, the file acknowledged.

Hong Kong-listed shares of Alibaba, Ant Group’s e-commerce affiliate, fell bigger than 4% Monday afternoon following the FT file. The decline weighed on the broader Chinese tech sector because the Grasp Seng Tech index declined virtually 3%, with shares of assorted Chinese tech heavyweights love Tencent and Meituan also taking a beating.

Reuters acknowledged in early September that divulge-support firms are build to remove a sizeable stake in the credit-scoring joint-project, with Ant and Zhejiang Tourism Funding Group owning 35% every of the project.

Ant is no longer going to be the handiest online lender in China struggling from the fresh principles, based mostly on the FT.

The most up-to-date traits marked more challenges for Ant’s industry. The corporate’s planned $34.5 billion IPO in November turn into once scuttled after regulatory discrepancies like been flagged.

Months of regulatory crackdown on China’s tech giants adopted, and Beijing introduced a slew of principles spherical anti-monopoly and information security and security.

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