Beautiful Virgin Islands

Tuesday, Jul 01, 2025

Ant Group reaches agreement with regulators on overhaul

Ant Group reaches agreement with regulators on overhaul

An agreement between Ant Group and the regulators would lift a cloud of uncertainty hanging over the company and from across the financial technology industry.

China’s financial regulators and Ant Group, controlled by Chinese billionaire Jack Ma, have agreed a plan to overhaul the planet’s largest financial technology company, according to people familiar with the matter.

The scheme involves Ant Group placing its major businesses into a financial holding company overseen by Beijing-based watchdogs, including its fabulously lucrative credit origination platform, its investment technology unit and its budding insurance operations, the people familiar said.

An official announcement could come as early as next week, but its timing is dependent on formal sign-offs in Beijing. An agreement between Ant Group
and the regulators would lift a cloud of uncertainty hanging over the firm’s day-to-day operations and from across the fintech industry. However, more robust regulations and higher compliance costs will curb growth at one of the world’s most valuable unicorns.

Ant Group operates mobile payments app Alipay.


Regulators abruptly shelved Ant Group’s US$34.5 billion dual listings in Shanghai and Hong Kong on November 3, over concerns that the Hangzhou-based firm posed a systemic risk to the country’s financial system and was in breach of consumers’ privacy. Soon afterwards, Beijing unleashed a raft of new fintech regulations and an antitrust inquiry into the country’s technology sector.

Ant Group, which operates the ubiquitous Alipay mobile payments platform, has been preparing to restructure its businesses to comply with the new rules since even before launching its initial public offering (IPO). An Ant Group spokesman declined to comment on the firm’s discussions with regulators.

Ant Group said in its IPO prospectus that it planned to use a subsidiary, Zhejiang Finance, to satisfy a requirement by regulators outlined on September 11 that fintech companies set up a financial holding company and apply to the central bank to do so by November 1.

Housing its financial operations in the holding company would mean they would be subject to rules similar to commercial banks, such as on how Ant Group sources and uses funds, maintaining a fat capital buffer, putting in place risk management systems and showing that it can protect consumers’ data from hacks and leaks.

A slew of new rules governing fintech means Ant Group is likely to apply for additional licences or reapply for existing licences when the final version of China’s fintech regulatory overhaul is published.

Ant Group named Li Chen as its chief compliance officer in November, a person familiar with the matter said earlier.

Beijing relies heavily on state-controlled banks to steer its still-developing economy, and China’s financial watchdogs are familiar with how to regulate traditional lenders. In the eyes of these regulators, keeping a closer eye on Ant Group and treating it more like a bank than a technology platform reduces the threat of disruption and stops the upstart from exploiting loopholes in their web of control.

Signs of a growing understanding between Ant Group and regulators have emerged over the past month. Yi Gang, the governor of China’s central bank, the People’s Bank of China (PBOC), hinted on January 26 that Ant Group could be allowed to pursue an IPO once it fully complies with the country’s laws and has addressed customer complaints.

Alibaba Group Holding, which owns a third of Ant Group, said on Tuesday that due to significant changes in the fintech regulatory environment in China, Ant Group is in the process of developing its rectification plan. Alibaba also owns the Post.

Ant Group’s business prospects and IPO plans are subject to substantial uncertainties. Currently, we are unable to make a complete and fair assessment of the impact that these changes and uncertainties will have on Alibaba Group. We will update the market once Ant Group has completed the relevant regulatory procedures for its rectification plan,” it said.

Ant Group had set up a working group to rectify its business practices and was drawing up a timetable for the changes under the guidance of regulators, Chen Yulu, a deputy governor of the PBOC, said on January 8.

When Ant Group’s size and influence in financial services became clear during its IPO marketing and road show, regulators fretted that any disruption in its services could pose a systemic risk to China’s financial stability and undermine the country’s sprawling banks.

Regulators also fretted that an influx of foreign investors into Ant Group’s capital structure would make it harder to control, according to people familiar with the matter at the time.

Ant Group’s slick mobile payment app, Alipay, has more than 1 billion users, making it the world’s most popular app outside social-media network.

Newsletter

Related Articles

Beautiful Virgin Islands
0:00
0:00
Close
Robots Compete in Football Tournament in China Amid Injuries
Trump Administration Considers Withdrawal of Funding for Hospitals Providing Gender Treatment to Minors
Texas Enacts Law Allowing Gold and Silver Transactions
China Unveils Miniature Insect-Like Surveillance Drone
OpenAI Secures Multimillion-Dollar AI Contracts with Pentagon, India, and Grab
Marc Marquez Claims Victory at Dutch Grand Prix Amidst Family Misfortune
Germany Votes to Suspend Family Reunification for Asylum Seekers
Elon Musk Critiques Senate Budget Proposal Over Job Losses and Strategic Risks
Los Angeles Riots ended with Federal Investigations into Funding
Budapest Pride Parade Draws 200,000 Participants Amid Government Ban
Southern Europe Experiences Extreme Heat
Xiaomi's YU7 SUV Launch Garners Record Pre-Orders Amid Market Challenges
Jeff Bezos and Lauren Sanchez's Lavish Wedding in Venice
Russia Launches Largest Air Assault on Ukraine Since Invasion
Education Secretary Announces Overhaul of Complaints System Amid Rising Parental Grievances
Massive Anti-Government Protests Erupt in Belgrade
Trump Ends Trade Talks with Canada Over Digital Services Tax
UK Government Softens Welfare Reform Plans Amid Labour Party Rebellion
Labour Faces Rebellion Over Disability Benefit Reforms Ahead of Key Vote
Jeff Bezos and Lauren Sánchez Host Lavish Wedding in Venice Amid Protests
Trump Asserts Readiness for Further Strikes on Iran Amid Nuclear Tensions
North Korea to Open New Beach Resort to Boost Tourism Economy
UK Labour Party Faces Internal Tensions Over Welfare Reforms
Andrew Cuomo Hints at Potential November Comeback Amid Democratic Primary Results
Curtis Sliwa Champions His Vision for New York City Amid Rising Crime Concerns
Federal Reserve Proposes Changes to Capital Rule Affecting Major Banks
EU TO HUNGARY: LET THEM PRIDE OR PREP FOR SHADE. ORBÁN TO EU: STAY IN YOUR LANE AND FIX YOUR OWN MESS.
Trump Escalates Criticism of Media Over Iran Strike Coverage
Trump Announces Upcoming US-Iran Meeting Amid Controversial Airstrikes
Trump Moves to Reshape Middle East Following Israel-Iran Conflict
Big Four Accounting Firms Fined in Exam Cheating Scandal
NATO Members Agree to 5% Defense Spending Target by 2035
Australia's Star Casino Secures $195 Million Rescue Package Amid Challenges
UK to Enhance Nuclear Capabilities with Acquisition of F-35A Fighter Jets
Russian Shadow Payments via Cryptocurrency Reach $9 Billion
Explosions Rock Doha as Iranian Missiles Target Qatar
“You Have 12 Hours to Flee”: Israeli Threat Campaign Targets Surviving Iranian Officials
Macron and Merz: Europe must arm itself in an unstable world
Germany and Italy Under Pressure to Repatriate $245bn of Gold from US Vaults
Airlines Evaluate Flight Cancellations Amid Escalating US-Iran Tensions
Starmer Invites Innovators to Join Government Talent Scheme
UK Economy’s Strong Opening Quarter Shows Signs of Cooling
Harrods Seeks Court Order to Secure Al Fayed Estate for Victims
BA and Singapore Airlines Cancel Dubai Flights Amid Middle East Tensions
Trump Faces Backlash from MAGA Base Over Iran Strikes
Meta Bets $14 B on Alexandr Wang to Drive AI Ambitions
WATCH: Israeli forces show the aftermath of a massive airstrike at Iran's Isfahan nuclear site
FedEx Founder Fred Smith, ‘Heart and Soul’ of the Company, Dies at 80
Chinese Factories Shift Away from U.S. Amid Trump‑Era Tariffs
Pimco Seizes Opportunity in Japan’s Dislocated Bond Market
×