China continues to crackdown on its fintech heavily and is preparing substantial fines for some of the big names in the industry, media reports said. Chinese authorities have recently summoned 13 fintech firms and ordered them to strengthen compliance with regulations.
Some of the big names include multinational technology conglomerate holding company Tencent and Beijing-based tech company ByteDance. Fintech arm of ecommerce giant JD.com, handset maker Xiaomi, ride-hailing app Didi Chuxing and food delivery firm Meituan were among those to face the regulators.
The recent developments are part of the ongoing antitrust clampdown backed by President Xi Jinping.
The People’s Bank of China said in a statement, “Internet platforms have played an important role in improving the efficiency of financial services and broadening the access of financial services to more people.”
“At the same time, some financial services were running without licenses, and there are serious rule violations in areas such as regulatory arbitrage, unfair competition and damaging consumers’ interests.”
Recently, it was also reported that Tencent could be fined as much as $1.5 billion for not reporting details of investments and anti-competitive practices.
The demands made by the Chinese regulators are similar to a list of demands they made of Alibaba’s affiliate financial company Ant Group earlier this month. Ant Group’s much anticipated initial public offering (IPO) was halted by authorities earlier this year over concerns about its finance model.
The crackdown initially began after Alibaba founder Jack Ma criticised the government last October. Earlier this month, Alibaba was slapped with a hefty fine of $2.8 billion over monopoly concerns.