Chinese officials have made it clear that Beijing wants the 1 billion plus-user superapp Alipay, owned by Jack Ma’s Ant Group, to be broken up and a separate app to be created for the company’s highly profitable loans business, reports the Financial Times. The move comes amid a crackdown on the Chinese fintech sector and is the most visible restructuring yet.
Chinese regulators have already ordered Ant to separate the backend of its two lending businesses, Huabei, which is similar to a traditional credit card, and Jiebei, which makes small unsecured loans, from the rest of its financial offerings and bring in outside shareholders. Now officials want the two businesses to be split into independent apps as well.
The plan will also require Ant to turn over the user data that underpins its lending decisions to a new credit scoring joint venture which will be partly state-owned, according to two people familiar with the process. “The government believes big tech’s monopoly power comes from their control of data,” one person close to financial regulators in Beijing told the FT. “It wants to end that.”