China Merchants Bank, (CMB) one of the country’s largest commercial banks, has finally won regulatory approval to set up a direct banking joint venture with financial service platformJingdong Digits Technology Holding (JD Digits), almost four years after it first announced the plan, reported Caixin.
China Merchants Tuopu Bank will be only the second direct bank with independent legal person status to get the go-ahead and its approval comes almost four years after China Citic Bank and search engine Baidu were given thegreen light for their joint venture, AiBank in January 2017. CMB announced its plan the following month.
The new bank is the latest manifestation of the growing collaboration between traditional lenders and technology companies as they seek to take a bigger share of the financial services market and challenge the dominance of Ant Group and Tencent in the fintech sector. The government is also encouraging cooperation as part of its broader inclusive finance strategy to bring low-cost financial services to the masses, especially those living in rural areas.