BEIJING / SHANGHAI (Reuters) – China’s central bank and three financial regulators held talks with senior leaders of Ant Group Co Ltd and its founder Jack Ma on Monday as Beijing released new draft rules for online microcredit.
The meeting comes after Ma questioned whether international financial regulations are right for the Chinese economy at a summit in Shanghai in late October.
Ant, backed by Alibaba Group Holding Ltd BABA.N9988.HK, is the dominant mobile payment company in China, also offering loans, insurance and asset management, and is expected to raise around $ 34.4 billion in the world’s largest initial public offering.
The People’s Bank of China, the China Securities Regulatory Commission (CSRC), the China Banking and Insurance Regulatory Commission and the foreign exchange regulator have held talks with the majority shareholder of Ant, Ma, its chairman. executive Eric Jing and its chief executive Simon Hu, the CSRC said in a statement, without giving details.
A spokeswoman for Ant said the company would “implement the meeting’s advice in depth.”
The draft microcredit rules, published separately by the central bank and the banking regulator, set a share capital threshold of 5 billion yuan ($ 748 million) for micro-lenders who offer loans online in different regions.
While it makes no mention of Ant, the project comes as regulators focus more on banks that heavily use micro-lenders or third-party tech platforms like Ant for underwriting consumer loans, in the middle. fears of an increase in defaults and a deterioration in asset quality in the event of a pandemic. hit the economy.
The project is open for public comment until December 2.
Guo Wuping, head of the consumer protection division at the banking regulator, said in a 21st Century Business Herald comment on Monday that the rights of users of consumer loan companies owned by Ant Huabei and Jiebei deserve consideration. attentive.
Guo in the commentary said that these fintech lending companies effectively perform the functions of banks and should adopt similar risk controls.
New methods of financing and disorderly competition have created “chaos that violates the rights and interests of financial consumers,” Guo said in the commentary.
The China Committee for Financial Stability and Development, a ministerial body headed by Vice Premier Liu He, on Sunday flagged the risks associated with the rapid development of fintech, in what has been widely interpreted as a government response to the rise of actors like Ant.
Reporting by Cheng Leng, Colin Qian, Yingzhi Yang and Brenda Goh; Additional reporting by Meg Shen in Hong Kong and Engen Tham in Shanghai; Writing by Tom Daly; Editing by Alexander Smith and Christopher Cushing
