Sci-Tech

Ant Group data attracts the Chinese government

“The regulation of data monopolies is at the heart of the matter,” said an adviser to the anti-trust committee of the Chinese State Council, which was reported by the Wall Street Journal. The regulation adopted by Zhejiang province, the region headquartered in Alibaba, to promote the digital economy, which facilitates data sharing, can only support the advice of the advisor.

Alibaba’s antitrust investigation, opened last December, specifically focuses on Ant Group, the financial arm of Jack Ma’s Imperium. It owns Alipay, a service that is used by more than a billion people and, like any banking service, contains a lot of data that says a lot about consumer habits. Specifically, based on this data, the company has issued nearly half a billion loans. The government, viewing this data as an unfair competitive advantage, has been seeking access to this data for several years.

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In 2015, Ant launched its own credit rating system in front of the Chinese central bank: Zhima Credit. It was three years before the Chinese central bank launched its own: Baihang Credit. Because of this, she asked eight companies, including Tencent, which owns WeChat Pay, and Ant, to participate in the capital of Baihang Credit. The aim is to restore their data to make them accessible to the country’s financial institutions. Lack of cooperation between companies did not achieve the goal. Ant refused to share his data on the grounds that it was his and that it would affect his competitiveness. For the government, however, the attempt was only partially unsuccessful. Zhima Credit was forced to review its activities and today it resembles a loyalty program that rewards highly rated customers.

Jack Ma criticized for “despite regulatory requirements”

When it comes to data, there is also the threat to the financial system. A concern of the Chinese Banking and Insurance Regulatory Authority (CBIRC), which announced in December 2020 that it was working on a bill on microcredit. The text is particularly aimed at the fintech sector, including Alipay, which benefits from a risk-free lending model that is at least transferred to partner banks. According to officials and government advisors, authorities are trying to change Ant’s business operations so that if the loan is granted, the company will provide more funding, while at the same time trying to break the company’s monopoly. Data access. While the outlines remain unclear, this will likely involve strengthening ties with the central bank.

In a statement, the Chinese central bank criticized Jack Ma’s group for “defying regulatory requirements”. In recent years the businessman has fallen through the cracks and stayed the course. However, as the recent measures against the companies such as the restructuring of the Ant Group or more generally against the digital giants show, the mesh is getting tighter today. This time around, Jack Ma, who has not appeared in public since a speech criticizing the Chinese legal framework in October, seems more likely to be required to submit.

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