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Tencent And Alibaba Are Fined In China’s Crackdown On Fintech

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Tencent And Alibaba Are Fined In China's Crackdown On Fintech

(CTN News) – There’s been a Alibaba crackdown on China’s fintech industry since late 2020, but it looks like it’s finally over.

Two of China’s biggest digital payments companies, Tencent and Ant Group, have been fined big by the People’s Bank of China.

Tencent and Tenpay were fined $2.99 billion yuan ($410 million) for regulatory violations related to mainland China payment services.

On the same day, the central bank announced a 7.123 billion yuan (roughly $1 billion) fine on Ant Alibaba Group for a range of illegal activities, such as corporate governance, consumer protection, banking and insurance, payments, settlement, anti-money laundering practices, and fund sales.

Besides digital payments, Alibaba and Tencent offer other financial services through their payment platforms. They’re part of China’s broader effort to curb its tech sector’s power and put it under more scrutiny.

In late 2020, China canceled Ant Group’s record-breaking IPO, which started the crackdown on fintech. A major restructuring has reduced Ant Group’s overall influence on consumer finance since then.

He gave up control of Alibaba and Ant Group, according to reports. Also, Ant’s main services are now regulated like traditional financial services.

According to the central bank, the fintech clampdown in China is coming to an end. In platform enterprises’ financial business, most of the prominent problems have been resolved, the bank said.

The regulators will now focus on regular supervision instead of fixing fintech issues.

The recent regulatory crackdowns on China’s tech industry have left investors and businesses wary. Fintech investments could be sparked again by the conclusion of corrective actions in the industry.

According to Tencent, financial regulators should now focus on normalizing regulation to promote the healthy growth of the platform economy. Moreover, platform companies are expected to receive support and encouragement to continue their financial inclusion efforts.

Tencent and Ant Group’s fines illustrate the Chinese government’s determination to maintain control over the rapidly growing fintech sector. China aims to improve financial stability and transparency by fineing and scrutinizing these tech giants.

In China’s fintech industry, the regulatory Alibaba crackdown has been a wake-up call. It serves as a reminder that even the most powerful players aren’t immune from regulation.

Companies will have to prioritize compliance and work closely with regulators to meet all requirements in the future.

As the fintech sector in China moves into a new phase of normalized regulation, the industry is expected to continue to grow and innovate. A more stable and sustainable future is possible thanks to the regulatory actions that have addressed some of the prominent problems in the sector.

Tencent and Ant Group’s recent fines indicate that China’s regulatory crackdown on fintech is coming to an end. The news signals a return to normalcy for Alibaba investors and businesses, potentially reigniting investment interest. Normalized regulations are expected to allow the industry to continue growing and innovating.

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Salman Ahmad is a seasoned writer for CTN News, bringing a wealth of experience and expertise to the platform. With a knack for concise yet impactful storytelling, he crafts articles that captivate readers and provide valuable insights. Ahmad's writing style strikes a balance between casual and professional, making complex topics accessible without compromising depth.

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