Ant underfoot: China’s permanent fintech crackdown
Beijing’s push to rein in its fintech champions, including Ant and Tencent, shows no sign of abating. It fears these big corporations and is busy handing out record fines – yet it would be wise not to go too far and undermine all the good things they do.
China’s crackdown on its technology and fintech champions shows no sign of easing.
In recent weeks Alibaba has been slapped with a $2.8 billion fine for anti-competitive practices, with the State Administration for Market Regulation also launching an investigation into food delivery giant Meituan for alleged monopolistic practices.
The central bank then got in on the act, summoning 13 digital companies including Tencent, Baidu and TikTok-owner ByteDance to Beijing to order them to comply with whatever regulations it deemed necessary.
“Beijing is cracking down on technology in general and fintech is one part of that,” says a Hong Kong-based banker. “This is just the start.”
How did this clampdown begin and how much longer is it likely to run?
To the first part, it’s easy to point to Ant Group founder Jack Ma’s comments at a financial forum in Shanghai last October.
It’s hard to imagine a more poorly timed and crafted speech. Regulators and senior state bankers were in the audience that day. They heard Ma accuse them of stifling innovation and having a “pawnshop” mentality.
Whether he was right or wrong, it marked a turning point – for everyone.