Ant Group Raises White Flag: "User Credit Information Shared with People's Bank of China"

[Image source=Reuters Yonhap News]

[Asia Economy Reporter Cho Hyun-ui] Alibaba Group's fintech subsidiary Ant Group has agreed to share users' credit information with the central bank, the People's Bank of China. Authorities have been tightening regulations on Ant Group since October last year, when Alibaba founder Jack Ma criticized Chinese finance as operating like a pawnshop business.

According to the Wall Street Journal (WSJ) on the 22nd (local time), Ant Group's microloan service Huabei announced via social media that it will be "integrated into the financial credit information database of the People's Bank of China's Credit Information Center."

The information Huabei will share with the People's Bank includes account opening date, credit limit amount, and repayment status. Specific transaction details such as what and when users purchased are not included.

Huabei explained, "We will ask users for their consent to provide their credit information to the People's Bank. If they do not agree, they will not be able to use the service."

WSJ evaluated, "Huabei's credit information is important for the People's Bank to develop a credit information and evaluation system similar to the U.S. personal credit scoring system (FICO). The integration of credit information is a meaningful step to align Ant Group with the policy priorities of Chinese authorities."

Huabei has been providing loans to young people who find it difficult to obtain credit cards from banks. However, this information has not been fully integrated into the People's Bank system, making it difficult for regulators to assess banks' potential exposure to default risk or individual creditworthiness.

Since Jack Ma's critical remarks in October last year, Ant Group has faced various regulatory pressures, including an indefinite postponement of its IPO. Ant Group is currently pursuing a transition to a financial holding company under the supervision and management of the central bank.

This content was produced with the assistance of AI translation services.