Alibaba shares (BABA) – Get the ADR report sponsored by Alibaba Group Holding Ltd. ended lower on Monday following a report that Chinese regulators are considering tightening their grip on Alipay, the company’s popular payments app.
Beijing is looking to create a separate app for Alipay’s highly profitable lending business, which is currently controlled by Alibaba founder Jack Ma’s Ant Group, according to the Financial Times.
The plan will also see Ant Group transfer the user data underlying its lending decision to a new credit scoring joint venture that will be partly state-owned, two sources familiar with the process told FT.
The state-backed companies are expected to take a “significant stake” in the joint venture, Reuters previously reported, with a plan to establish a personal credit rating company where Ant and Zhejiang Tourism Investment Group will each hold 35% and others supported by the state. partners each holding 5%.
Alibaba closed down $ 2.69, or 1.6%, at $ 165.41 on Monday.
Chinese regulators last week focused their focus on the use of video games by Chinese youth, continuing their crackdown on excessive screen time.
The South China Morning Post reported that Beijing has temporarily suspended approval of all new online video games in an attempt to slow down gambling addiction among young people. The move essentially means that “everything is on hold,” a source told SCMP.
China last month said it was studying proposals for more regulations, including potential changes to the way businesses use data for advertising.
Beijing is seeking to curb internet and tech companies that it says have bypassed rules and regulations.
In July, the Chinese competition regulator ordered Tencent Music Entertainment Group (TME) – Get Tencent Music Entertainment Group Sponsored Class A ADR Report to relinquish its exclusive music license rights and to fine the company for anti-competitive behavior.
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