Ant Group Co. Ltd. Alibaba’s payments platform will restructure into a financial holding company supervised by the central bank, Central Bank Deputy Governor Pan Gongshengha issued the ruling at the end of a meeting with the top management of the financial platform on which China now tightens control. The turning point will also be an example for other Chinese fintechs. Ant is accused of failing to abide by the rules of a range of authorities ranging from the Central Bank to Forex, to the Financial Markets Supervisory Commission.
The turning point of the central bank
The restructuring is part of a plan developed under the guidance of regulators, but this time Pan Gongsheng, deputy governor and leader of Safe, the agency that monitors financial flows after yet another meeting with vertices of Ant.
The general motivation is very clear. “The fifth plenary session of the 19th Central Committee of the Communist Party of China, the Central Conference of Economic Work and the ninth session of the Central Committee of Finance and Economic Affairs – explained Pan – made it clear that we should prevent the disorderly expansion of resources. of capital and prevent risks. The need to establish and improve the economic governance system of financial platforms arises from the construction of a national competition.
The investigation conducted by the authorities
After the four supervisors’ interviews in December last year, just after the failed public listing, Ant Group established a dedicated team to formulate rectification plans under the guidance of the Ministry of Financial Management. The Ministry of Financial Management again interviewed the Ant Group.
Hence the request to change skin and to undergo direct supervision from now on. Moreover, the indications already exist for all platforms, with a series of stringent provisions. After the antitrust fine for Alibaba, which, moreover, has even gained on the stock exchange, the platform will need to be adapted to the new rules that provide for a detachment from the traditional banking system, a combination that has created many problems given that platforms have started to act like banks.