People's Bank of China: "Strict Regulation on Fintechs like Alipay for Loans, Insurance, and Fund Sales"

A pedestrian passing in front of the "Alipay" logo outside Ant Group's Shanghai office in August last year. (Shanghai AFP=Yonhap News)

[Asia Economy Reporter Kim Daehyun] Yi Gang, Governor of the People's Bank of China (PBOC), announced a strong intention to strictly regulate fintech platforms, including Alibaba's affiliate 'Alipay,' that provide other financial services such as loans and financial investment product sales beyond simple electronic payments.

According to the PBOC website on the 11th, Governor Yi recently stated at the Bank for International Settlements (BIS) meeting, "Internet companies have been conducting extensive financial businesses without proper licenses while assessing individuals' credit status," adding, "This corresponds to unauthorized personal credit evaluation business."

Governor Yi said, "These companies simultaneously sell financial investment products, loans, and insurance on a single platform, increasing the risk of financial hazards spreading throughout the entire market," and mentioned that the development of fintech threatens the safety of personal information. He added that they will prevent the spread of financial risks in advance through firewalls that thoroughly separate electronic payments from other financial services.

Since last year, Chinese authorities have significantly strengthened regulations on large internet companies such as Alibaba and strictly regulate fintech firms like Ant Group, the operator of Alipay, from entering other financial service areas such as credit loans, financial investment product purchases, and insurance subscriptions beyond simple electronic payments.

Meanwhile, Ma Yun's Ant Group is facing a situation where its actual ownership may change due to the authorities' financial holding company restructuring and demands for large-scale capital increases.

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