Ant Group, the online finance arm of Chinese e-commerce giant Alibaba, announced a comprehensive overhaul of its business on Monday in response to a request from the Chinese government. quickly curb the power of the country’s internet giants.
Beijing’s campaign has taken the corporate empire of Jack Ma, the billionaire co-founder of Alibaba and a controlling shareholder of Ant, as the primary target soon. On Saturday, China’s antitrust agency fined Alibaba $ 2.8 billion for abusing its dominant position in digital retail – a record amount for violating the country’s antitrust laws. .
As part of what both Ant Group and Chinese officials call a “rectification plan”, the company on Monday said it would apply for a financial joint stock company, which would bring re-scrutiny is more stricter and requires that they hold more money or lend or use it with interest.
Ant also said it will change the way personal information is collected and used to improve data security and prevent misuse. And it says they will improve corporate governance to better adhere to the rules of fair competition.
“Under the guidance of the financial regulators, Ant Group will make no effort in implementing the rectification plan,” the company said in a statement. “Using reform as an opportunity, Ant Group will reinforce our commitment to serving consumers, small businesses and the real economy.”
Chinese officials forced Ant to cancel its initial public offering in November, just days before the company’s shares were scheduled to launch. A month later, the regulators ordered Ant to fix what it called a string of business failures, covering a range of financial services, from payments to credit, to be provided through the Alipay app.
Alipay’s user base of more than 700 million people in China gives Ant a great influence in the country’s financial system.
China first said last September that companies that own two or more financial businesses would have to register as financially owned and subject to increasing government scrutiny. During a press conference at the time, an official at the Chinese central bank called Ant one of the companies likely to be restructured under the new rules.
The aim, officials said, is to better monitor systemic risks that arise as more and more “blind” non-financial firms enter the financial industry.