A senior official at China’s banking regulator has warned that technological advances in the financial industry risked creating monopolies, a day after Beijing unveiled new antitrust rules for the nation’s largest internet groups.
The warning helped fuel a second day of selling of Chinese tech stocks, wiping a total of about $254bn in market value off ecommerce groups such as Alibaba, JD.com and Tencent.
“Special attention must be paid to the new risks brought about by the digital transformation [of financial services],” said Liang Tao, vice-president of the China Banking and Insurance Regulatory Commission at a forum in Beijing on Wednesday. “This is especially true with cyber security, data protection and market monopoly.”
The remarks follow China’s release on Tuesday of draft antitrust regulations for internet platforms targeting a range of monopolistic practices common among online groups, such as the unscrupulous collection and use of customer data.
Analysts said the harsher official stance suggested Beijing was becoming less tolerant of the nation’s burgeoning private fintech companies, led by Ant Group, which until recently were hailed as a disruptive force in an otherwise state-dominated and highly inefficient industry.
“The likes of Ant Group have grown by so much that the government now sees them as a drag on, rather than a driver of, the economy,” said Bo Zhuang, an economist at TS Lombard.
China’s fintech industry has come under fire after Beijing abruptly cancelled the proposed $37bn listing of Alibaba’s online payments and lending arm, Ant Group, in Hong Kong and Shanghai.
The move followed a speech in late October by Alibaba’s founder, billionaire Jack Ma, who criticised global financial regulation and the nation’s state-owned banks for focusing too much on risk control.
Ahead of the IPO, China launched draft new online lending rules that threaten to impose heavy restrictions on companies such as Ant, ranging from limits on how much they can lend to individuals, to tighter capital ratios.
CBIRC’s Mr Liang stressed that financial technology did not “change the nature of finance”.
“All kinds of financial activities must be subject to regulation,” he said. “[Businesses] must follow the same practices, rules and risk management requirements as long as they conduct financial operations of the same kind.”
A director at the consumer lending department of a major state bank in Shanghai said Ant Group’s strong pool of consumer data had given the firm an edge in scoring borrowers that few lenders could rival.
“While the regulator has prohibited banks from outsourcing their risk-control function, most of them are lagging behind Ant in both the mastering of the technology and the collection of borrower data,” the banker said.
Ant has previously refused to share its customer loan data with China’s central bank.
Article From & Read More ( China’s banking regulator signals tougher fintech antitrust laws - Financial Times )https://ift.tt/3eVeb5J
Business
No comments:
Post a Comment