Chinese regulators are looking to break Alipay, the popular payment app for Jack Ma’s ant group, according to a new Financial Times report.
According to the FT, regulators want Alipay to create a separate app for its lending business and transfer user data to a new credit score joint venture, in which Chinese state-owned companies will have a major stake.
Reuters first reported on the joint venture last week.
Under the new plan, Alipay (which has more than 1 billion users) will no longer be able to check customers ’internal solvency and will have to rely on external credit scores. Citing sources, the FT added that Alipay will not be the only online lender in China affected by the changes.
Earlier this year, Alipay was forced to set up an independent consumer finance company that would own Ant’s two credit services, Huabei and Jiebei.
The movements are part of China’s efforts to suppress the monopolies of technology companies. Last year, Ant Group’s $ 34 billion IPO in Hong Kong and Shanghai was suspended at the last minute after Ma, the company’s founder, publicly criticized Chinese regulators.
Ma said Ant Group will follow the demands of regulators, leaving open the possibility of a future IPO.
Ant Group is affiliated with Alibaba Group 9988,
which saw its Hong Kong shares fall on Monday after the report.