Under the Anti-Monopoly Law, China is planning to restrict the total number of banks per fintech platform. The former Finance Minister Lou Jiwei told that the Communist Party could very well restrict the number of banks a single platform can tie-up with. According to the Chinese State Media, this is purely to avoid one company gaining too much market share.
China recently warned the tech giants that scrutiny is inevitable. The planned stock listing of $37bn of Alibaba’s Ant Group has then suspended abruptly.
Lou who is now an influential external affairs director at a top advisory body of the Chinese Communist government said the oversized market of a fintech company could lead to bad debt.
As per Reuters, he said,
“We can limit the number of banks that any single platform can work with, so as to let more platforms do similar businesses under the same conditions,” he said, adding that fintech platforms should not be allowed to grow to the point of “winner takes all” and “too big to fail”.
China has lately hinted at oversighting big tech firms such as Alibaba and Tencent Holdings. These companies have acquired a huge amount of user data and these are some of the most valuable companies in the world.
Security watchdog officials hinted at digital tax for holding the user data as well.
Last week, regulators also fiend tech giants like Alibaba for not reporting past deals properly. China has an Anti-Monopoly law since 2008, but this is the first time a company has been fined under that.