Ant Group to separate its lending business

Tuesday 14 September 2021 14:37 CET | News

China-based Ant Group has reorganised its businesses to comply with the Chinese central bank’s instructions to sever its Alipay payments service from other services that offer consumer loans.

The Hangzhou-based company may create a separate mobile application for the lending business, currently operating under the brand names Huabei and Jiebei. Ant was called in for a regulatory meeting by the People’s Bank of China (PBOC) in April 2021, and told it had to cut its consumer lending ties as part of regulators’ expectations of how the group should restructure and rectify its businesses.

Launched in 2014 and 2015, respectively, Huabei and Jiebei offer consumer loans to Alipay users. Huabei, for example, allows Alipay users who do not have credit cards to make online and offline purchases and repay the amount through monthly instalments in up to 12 months.

Ant extends such credit lines based on its internal credit assessment models. The bulk of these loans were funded by its partner banks, according to its draft prospectus filed with the Hong Kong stock exchange in 2020 as part of its listing application.

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Keywords: Alipay, mobile payments, central bank, lending
Categories: Banking & Fintech
Countries: China
This article is part of category

Banking & Fintech