Chinese regulators on Sunday ordered financial-technology giant Ant Group to correct what they said A crown of business failures, The creation of a pressure campaign that has been stalling the company’s plans since the government’s sudden creation Record breaking share listing last month.
The Chinese government has begun to take a tough stance towards big internet companies, which like Facebook, Google and other tech giants have been able to make a big impact in the sectors of the economy. China’s market regulator has recently opened a Antimonopoly probe In Ant’s sister company, e-commerce behemoth Alibaba; Alibaba is the second pillar of the business empire built by China’s richest man and most famous tycoon Jack Ma.
Ant’s Alipay platform began as a payment service for Alibaba’s online shopping sites, but has grown to help it 730 million monthly users Take out small loans, invest their savings and buy insurance. Alipay’s growth to keep the world’s largest initial public offering put Ant in the course. This prompted officials to see if Ant was unfairly benefiting from facing fewer inspections than traditional financial institutions.
Agencies said officials of four financial monitoring departments, including the central bank, met Ant on Saturday. On Sunday, a deputy governor at the central bank, Pan Gongsheng, described how the discussion was Written question and answer session This cleared the regulators’ deep displeasure with the company.
Mr. Pan said that he was the main ant problem. Its corporate governance “was not sound,” he said. It was “indifferent” to the law, “looked down upon” compliance requirements and engaged in “regulatory arbitration”. It took advantage of its dominance, with Mr. Pan asking to outlast rivals. And it damaged the interests of consumers.
Regulators have ordered Ant to “return to its payment origins”, Mr Pan said, and “strictly improve illegal credit, insurance and money management financial activities”. Such demands may dictate that agencies ask Ant to shut down business lines that are important to its revenue.
Mr. Pan also said that the regulators had ordered Ant to reorganize itself to ensure that it met the capital requirements. Putting more money on your books to pay back your lending activities can cover the ant’s bottom line.
Regulators have played in China Give with ant For the year. When the company created a money-market fund within Alipay paying higher rates than bank deposits, the government forced the fund to risk and lower returns. Ant started managing huge amounts of money in virtual virtual purses, with the central bank parking it in special accounts where they earned the lowest interest.
In a statement, Ant said it would make a plan for compliance with the new requirements.
“We appreciate the guidance and help from financial regulators,” the statement said. “Antification is an opportunity for the Ant Group to develop the foundation of our business with full compliance.”