BEIJING/HONG KONG: China's top financial regulators told Ant Group Co Ltd's founder Jack Ma and two top executives that the company's lucrative online lending business faces tighter government scrutiny, sources told Reuters, days before its record-setting listing.
Ant's credit unit contributed close to 40per cent of the group's revenue in the first half of the year. It holds Ant's consumer credit business that includes Huabei, which operates like a virtual credit card service, and short-term consumer loan provider Jiebei. "Ant's high-profile blockbuster IPO has become the tipping point as it urges all relevant regulators to step up efforts to look into its sprawling business."
The draft, open for public feedback until Dec. 2, requires small online lenders to provide at least 30per cent of any loan they fund jointly with banks, which is widely considered to be a key rule that will hurt the profitability of Ant's current business model.
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