China plans to implement tighter oversight of fintech firms and urge payments companies to focus more narrowly under reforms agreed to on Wednesday, state media reported.
A top-level meeting urged better cooperation among regulatory agencies to ensure big fintech companies don’t engage in risky behaviour.
The meeting outlined that China will support platform companies in servicing the real economy, state news agency Xinhua said, without giving details.
Beijing authorities would push large payments companies and fintech platforms to return to their roots, Xinhua also quoted the meeting as saying.
The country will also strengthen the supervision of financial holding firms and of platform firms participating in financial activities, it added.
Tech Shares Rise In Hong Kong
China tech firms listed in Hong Kong rose on Thursday, after Chinese President Xi Jinping signalled support to the country’s leading payment and fintech firms in the latest indication that Beijing is easing its regulatory crackdown on the sector.
The Hang Seng Tech Index shed gains after rising as much as 2% earlier in the session.
Hong Kong-listed shares of Alibaba Group Holding rose more than 2%. Fintech giant Ant Group is an affiliate of Alibaba.
“This is not unexpected, but gives a clear regulatory direction,” Kuang Yuqing, founder of Lens Company Research said, adding that it could help speed up listing process for Ant Group.
Beijing has in recent months softened its stance over a wide-ranging crackdown that started in late 2020 with Chinese authorities abruptly pulling the plug on fintech giant Ant Group‘s initial public offering.
The crackdown was later expanded to multiple industries, including technology, education and property.
Ant has been working with financial regulators for months on a broad revamp that would see the fintech group sever many ties with its former parent Alibaba Group.
China’s central bank has reportedly accepted Ant’s application to set up a financial holding company, a key step to finish the restructuring and reviving its stock market debut.
Besides the plan related to payment and fintech firms, the meeting chaired by Chinese leader Xi Jinping also approved plans on building a basic data system, as well as encouraging technology talents, Xinhua said.
- Reuters, with additional editing by George Russell