Chinese regulators ordered Jack Ma’s online financial titan Ant Group to return to its roots as a provider of payments services, threatening to throttle growth in its most lucrative businesses of consumer loans and wealth management.
The central bank summoned Ant executives over the weekend and told them to “rectify” the company’s lending, insurance and wealth management services, the People’s Bank of China said in a statement Sunday. While it stopped short of directly asking for a break-up of the company, the central bank stressed that Ant needed to “understand the necessity of overhauling its business” and come up with a timetable as soon as possible.
The series of edicts represent a serious threat to the expansion of Mr Ma’s online finance empire, which has grown rapidly from a PayPal-like operation into a full suite of services over the past 17 years. Before regulators intervened, Ant was poised for a public listing that would have valued it at more than $300 billion. The Hangzhou-based firm now needs to move forward with setting up a separate financial holding company to ensure it has sufficient capital, and protect personal private data, the central bank said.
“This is the culmination of a string of regulations and sets the direction for Ant’s business going forward,” said Zhang Xiaoxi, a Beijing-based analyst at Gavekal Dragonomics. “We haven’t seen clear indication of break-up yet. Ant is a giant player in the world and any break-up needs be to be cautious.”
Authorities also blasted Ant for sub-par corporate governance, disdain toward regulatory requirements, and engaging in regulatory arbitrage. The central bank said Ant used its dominance to exclude rivals, hurting the interests of its hundreds of millions of consumers.
China last week intensified its scrutiny of the twin pillars of billionaire Mr Ma’s internet domain when it also kicked off an investigation into alleged monopolistic practices at Ant affiliate Alibaba Group. The e-commerce firm’s US-listed shares tumbled by the biggest amount ever on news of the probe.
The State Administration for Market Regulation dispatched investigators to Alibaba on Thursday and the onsite investigation was completed on the day, according to a report on Saturday posted on a news app run by the Zhejiang Daily. The report cited an unnamed official from the local market regulation watchdog in Zhejiang province, where Alibaba is based.
Ant said in a statement on Sunday that it will set up a special team to create proposals and a timetable for an overhaul. It will maintain business operations for users, vowing to keep costs for consumers and financial partners unchanged, while stepping up risk control.
The pressure on Mr Ma is central to a broader effort to curb an increasingly influential internet sphere.
Once hailed as drivers of economic prosperity and symbols of the country’s technological prowess, the empires built by Mr Ma, Tencent Holdings’s chairman “Pony” Ma Huateng and other tycoons are now under scrutiny after amassing hundreds of millions of users and gaining influence over almost every aspect of daily life in China.
Mr Ma’s own empire is in crisis mode. Alibaba has shed more than $200 billion of market value since November, when regulators torpedoed what would have been a record $35 billion Ant debut.
His top executives are part of a task force that already has almost daily interactions with watchdogs. Meanwhile, regulators, including the China Banking and Insurance Regulatory Commission, are weighing up which businesses Ant should give up control of to contain the risks it poses to the economy, officials have said. They haven’t settled on whether to carve up its different lines of operation, split its online and offline services, or pursue a different path altogether.
“Ant’s growth potential will be capped with the focus back onto its payments services,” said Shujin Chen, the Hong Kong-based head of China financial research at Jefferies Financial Group. “On the mainland, the online payments industry is saturated and Ant’s market share pretty much reached its limit.”
More from Rashmee Roshan Lall
Other ways to buy used products in the UAE
UAE insurance firm Al Wathba National Insurance Company (AWNIC) last year launched an e-commerce website with a facility enabling users to buy car wrecks.
Bidders and potential buyers register on the online salvage car auction portal to view vehicles, review condition reports, or arrange physical surveys, and then start bidding for motors they plan to restore or harvest for parts.
Physical salvage car auctions are a common method for insurers around the world to move on heavily damaged vehicles, but AWNIC is one of the few UAE insurers to offer such services online.
For cars and less sizeable items such as bicycles and furniture, Dubizzle is arguably the best-known marketplace for pre-loved.
Founded in 2005, in recent years it has been joined by a plethora of Facebook community pages for shifting used goods, including Abu Dhabi Marketplace, Flea Market UAE and Arabian Ranches Souq Market while sites such as The Luxury Closet and Riot deal largely in second-hand fashion.
At the high-end of the pre-used spectrum, resellers such as Timepiece360.ae, WatchBox Middle East and Watches Market Dubai deal in authenticated second-hand luxury timepieces from brands such as Rolex, Hublot and Tag Heuer, with a warranty.
Company Profile
Name: Thndr
Started: 2019
Co-founders: Ahmad Hammouda and Seif Amr
Sector: FinTech
Headquarters: Egypt
UAE base: Hub71, Abu Dhabi
Current number of staff: More than 150
Funds raised: $22 million
New UK refugee system
- A new “core protection” for refugees moving from permanent to a more basic, temporary protection
- Shortened leave to remain - refugees will receive 30 months instead of five years
- A longer path to settlement with no indefinite settled status until a refugee has spent 20 years in Britain
- To encourage refugees to integrate the government will encourage them to out of the core protection route wherever possible.
- Under core protection there will be no automatic right to family reunion
- Refugees will have a reduced right to public funds
How being social media savvy can improve your well being
Next time when procastinating online remember that you can save thousands on paying for a personal trainer and a gym membership simply by watching YouTube videos and keeping up with the latest health tips and trends.
As social media apps are becoming more and more consumed by health experts and nutritionists who are using it to awareness and encourage patients to engage in physical activity.
Elizabeth Watson, a personal trainer from Stay Fit gym in Abu Dhabi suggests that “individuals can use social media as a means of keeping fit, there are a lot of great exercises you can do and train from experts at home just by watching videos on YouTube”.
Norlyn Torrena, a clinical nutritionist from Burjeel Hospital advises her clients to be more technologically active “most of my clients are so engaged with their phones that I advise them to download applications that offer health related services”.
Torrena said that “most people believe that dieting and keeping fit is boring”.
However, by using social media apps keeping fit means that people are “modern and are kept up to date with the latest heath tips and trends”.
“It can be a guide to a healthy lifestyle and exercise if used in the correct way, so I really encourage my clients to download health applications” said Mrs Torrena.
People can also connect with each other and exchange “tips and notes, it’s extremely healthy and fun”.
Living in...
This article is part of a guide on where to live in the UAE. Our reporters will profile some of the country’s most desirable districts, provide an estimate of rental prices and introduce you to some of the residents who call each area home.
French business
France has organised a delegation of leading businesses to travel to Syria. The group was led by French shipping giant CMA CGM, which struck a 30-year contract in May with the Syrian government to develop and run Latakia port. Also present were water and waste management company Suez, defence multinational Thales, and Ellipse Group, which is currently looking into rehabilitating Syrian hospitals.
The specs: 2019 Haval H6
Price, base: Dh69,900
Engine: 2.0-litre turbocharged four-cylinder
Transmission: Seven-speed automatic
Power: 197hp @ 5,500rpm
Torque: 315Nm @ 2,000rpm
Fuel economy, combined: 7.0L / 100km
White hydrogen: Naturally occurring hydrogen
Chromite: Hard, metallic mineral containing iron oxide and chromium oxide
Ultramafic rocks: Dark-coloured rocks rich in magnesium or iron with very low silica content
Ophiolite: A section of the earth’s crust, which is oceanic in nature that has since been uplifted and exposed on land
Olivine: A commonly occurring magnesium iron silicate mineral that derives its name for its olive-green yellow-green colour
'The worst thing you can eat'
Trans fat is typically found in fried and baked goods, but you may be consuming more than you think.
Powdered coffee creamer, microwave popcorn and virtually anything processed with a crust is likely to contain it, as this guide from Mayo Clinic outlines:
Baked goods - Most cakes, cookies, pie crusts and crackers contain shortening, which is usually made from partially hydrogenated vegetable oil. Ready-made frosting is another source of trans fat.
Snacks - Potato, corn and tortilla chips often contain trans fat. And while popcorn can be a healthy snack, many types of packaged or microwave popcorn use trans fat to help cook or flavour the popcorn.
Fried food - Foods that require deep frying — french fries, doughnuts and fried chicken — can contain trans fat from the oil used in the cooking process.
Refrigerator dough - Products such as canned biscuits and cinnamon rolls often contain trans fat, as do frozen pizza crusts.
Creamer and margarine - Nondairy coffee creamer and stick margarines also may contain partially hydrogenated vegetable oils.
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Manchester United v Club America
When: Thursday, 9pm Arizona time (Friday UAE, 8am)
Global state-owned investor ranking by size
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United States
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China
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UAE
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Japan
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5
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Norway
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Canada
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Singapore
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Australia
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Saudi Arabia
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South Korea
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What can victims do?
Always use only regulated platforms
Stop all transactions and communication on suspicion
Save all evidence (screenshots, chat logs, transaction IDs)
Report to local authorities
Warn others to prevent further harm
Courtesy: Crystal Intelligence
Company Profile
Name: JustClean
Based: Kuwait with offices in other GCC countries
Launch year: 2016
Number of employees: 130
Sector: online laundry service
Funding: $12.9m from Kuwait-based Faith Capital Holding
