Beijing plans to dismantle Alipay, the popular Alibaba-affiliated payment app, and create a separate app for lending activities, amid a crusade against anti-competitive practices, the Financial Times said Monday.
The authorities have launched in recent months in China a campaign to curb what they see as a “disorderly” development of the economy, causing the companies concerned to lose billions of euros in stock market value.
Ant Group, an Alibaba subsidiary which owns Alipay, was the first to find itself in the sights of regulators, who have since extended their takeover to other sectors (education, entertainment, video games, real estate, etc.).
At the end of 2020, Beijing had thus put a stop to a gigantic IPO of Ant Group in Hong Kong.
And its parent company Alibaba, founded by the whimsical billionaire Jack Ma, was subsequently fined 2.3 billion euros for abuse of a dominant position.
The authorities now want to split the Alipay app into two separate entities, one for payments and another specific to the lucrative online lending business, says the Financial Times.
Will Alipay’s departure benefit WeChat Pay
Ant Group will also have to cede its user data related to loans to a credit rating agency, partly owned by the state, believes the daily business, which does not cite any source.
Ant Group and Alibaba did not immediately react to AFP’s requests.
Alipay is an essential application in China, where cash has almost disappeared and the vast majority of payments are made from a smartphone. It dominates the market with its competitor WeChat Pay (Tencent).
The authorities have been particularly intransigent in recent months against practices hitherto widely tolerated and widespread in several dynamic sectors of its economy, particularly in terms of competition.
On Monday, the Ministry of Industry and Information Technology (MIIT) warned digital giants against blocking links between competing services and impediments to interoperability.
In China, for example, certain payment systems are excluded from e-commerce apps belonging to a rival group. And video platforms are blocking content sharing to competing social networks.
The Chinese market regulator announced last month that it was considering strengthening legislation on these issues.