Alipay operator Ant Group to create separate app for lending business
- The Hangzhou-based company, an affiliate of Alibaba Group, may create the separate app, according to a report by the Financial Times
- Company was ordered by the People’s Bank of China in April to cut consumer lending ties
Ant Group, the world’s largest e-payment platform, has been reorganising its businesses to comply with the Chinese central bank’s instructions in April to sever its Alipay payments service from other services that offer consumer loans.
The Hangzhou-based company, an affiliate of this newspaper’s owner Alibaba Group Holding, may create a separate mobile application for the lending business, currently operating under the brand names Huabei and Jiebei, according to a report by the Financial Times. Ant Group officials did not respond to requests for comment on Monday.
“Ant must cut the improper connections between Alipay and other financial products, such as Huabei and Jiebei, and to rectify irregular practices such as embedding credit business in payment links,” the PBOC said. The meeting was called to “require Ant to face up to the serious problem in the financial business activities and realise the seriousness of its rectification”.
Launched in 2014 and 2015, respectively, Huabei and Jiebei offer consumer loans to Alipay users. Huabei, for example, allows Alipay users who do not have credit cards to make online and offline purchases and repay the amount through monthly instalments in up to 12 months.
Ant extends such credit lines based on its internal credit assessment models. The bulk of these loans were funded by its partner banks, according to its draft prospectus filed with the Hong Kong stock exchange last year as part of its listing application.