The People’s Bank of China (PBOC) has imposed a fine of RMB7.12bn (USD984m) on Ant Group, marking the end of the regulatory crackdown on the Chinese fintech giant, as reported by Reuters on July 7. The PBOC stated that Ant Group violated laws and regulations related to corporate governance, financial consumer protection, payment and settlement business, and anti-money laundering obligations. The central bank also ordered Ant Group to halt the operations of its crowdfunded medical aid service, Xianghubao, and compensate the users. Meanwhile, fines were imposed on five other fintech companies, including a penalty of RMB3.06bn (USD423m) on Tencent Holdings’ [0700:HK] online payment platform Tenpay for violations in areas such as customer data management.

The PBOC stated that most of the significant problems in the financial business of platform enterprises have been rectified, signaling a shift from centralized rectification to normal supervision. This announcement is expected to provide clarity for Ant Group’s business development and potentially pave the way for its IPO. Ant Group’s planned USD37bn listing on the Hong Kong and Shanghai exchanges was suspended in November 2020 due to concerns over systemic risk. In April 2021, the company was fined a record RMB18bn (USD2.48bn) for antitrust violations. Since then, Ant Group has undergone a comprehensive business restructuring to transform into a financial holding company, complying with rules and capital requirements similar to those for banks.  

Sources:

https://www.reuters.com/technology/china-end-ant-groups-regulatory-revamp-with-fine-least-11-bln-sources-2023-07-07/

https://www.scmp.com/business/article/3226964/china-imposes-us98433-million-fine-ant-group-paving-way-new-business-and-potential-revival-ipo

https://www.bloomberg.com/news/articles/2023-07-07/china-ends-probe-of-jack-ma-backed-ant-with-984-million-fine

https://www.theguardian.com/business/2020/nov/03/biggest-share-offering-in-history-on-hold-as-ant-group-suspends-launch