After the halt of what would have been the world’s largest IPO, Ant’s chairman Eric Jing gave his first public remarks at the Fourth China Internet Finance Forum and talked about Ant’s future plan. He promised to make Ant Group more ‘transparent and predictable’ to the public.

For years fintech in China developed quickly, but with limited regulation, not just because the regulator encouraged innovation, but also because of the challenges in regulating a company as new and quickly moving as Ant. Now with more regulatory focus on the firm, we are likely to see more restrictions and regulatory action.

Monday, 28 December 2020 09:12

Sunmi Technology Files for A-share IPO

Established in December 2013, Sunmi is an IoT technology company and part of Xiaomi’s ecological industry chain; Xiaomi has also invested in two consecutive rounds of Sunmi’s financing. The company provides intelligent commercial hardware and solutions. Its products are sold in over 200 countries with 1.5 million active merchant clients. Sunmi smart POS can support self-checkout and facial payment and its smart camera helps merchants analyze customer shopping behavior.

Guo Shuqing, the chairman of the China Banking and Insurance Regulatory Commission (CBIRC), said that “the regulator will take timely and accurate measures to eliminate new systemic risks” in a presentation at the recently held Singapore Fintech Festival. He pointed out that a few technology companies occupy a dominant position in the micropayment market, involve the interests of the general public, and have the characteristics of an important financial infrastructure. Furthermore, he said, some large-scale technology companies are involved in various financial and technological fields, and multiple cross-border operations. These points have been interpreted as a signal that fintechs in China will come under greater supervision in the near future.

On December 8th, China Construction Bank’s Singapore branch officially acquired its Qualifying Full Bank (QFB) license from the Monetary Authority of Singapore (MAS). According to the MAS, foreign banks with QFB privileges may undertake universal banking and operate a total of 25 branches. With the new license, CCB will set up a commodity trade financing center, an investment banking business transaction center, and a financial technology innovation center in Singapore. Together with CCB Singapore’s original infrastructure construction service center and private banking business center, those businesses will become CCB Singapore’s key local services in the future.

On December 11th, China Merchant Bank (CMB) announced that it had received approval to launch a “Direct Selling Bank.” The bank, named Zhaoshang Tuopu Bank (招商拓扑银行), will be 70% held by CMB and 30% by Chinabank Payments (网银在线), a wholly owned subsidiary of JD Digits. This is the second such license issued after Baixin Bank, jointly owned by CITIC Group and Baidu, received its license in 2017. With the license, Zhaoshang Tuopu Bank will conduct business online with no physical branches. In terms of business scope, a direct selling bank license is not much different from a private internet bank license, such as those issued to Webank or Mybank. For JD Digits, it is meaningful that it has finally entered the online banking competition, joining competitors such as Ant, Tencent and Xiaomi, which have already acquired their own respective internet banking licenses.

Tuesday, 15 December 2020 02:01

DCEP Undergoing Second Pilot Testing in Suzhou

Suzhou is currently conducting China’s second public pilot test of the digital RMB (DCEP), following the first pilot recently held in Shenzhen. Under this second public test being held in Suzhou, 100,000 red pockets, totaling RMB20 million will be issued. These will be valid from December 11th to December 25th. Over 10,000 merchants have signed up to participate in this second public pilot round. Meanwhile, JD.com is also participating in this second round, becoming the first ecommerce platform to get involved.

The central bank’s Digital Currency Research Institute and China UMS, a subsidiary of China UnionPay, signed a strategic cooperation agreement on December 8th. The parties will leverage UnionPay’s consumer network, conduct joint research, and expand the product functions and application scope of the digital renminbi. UMS is one of the largest comprehensive payment service providers in China. Its POS business was ranked the 1st in APAC according to Nelson in 2018. Its existing payment network will further promote the construction of the digital renminbi ecosystem.

Tuesday, 15 December 2020 02:00

Pinduoduo Tests New Wallet Function

Duoduo Wallet, launched by Pinduoduo, China’s largest e-commerce platform, is currently undergoing internal testing. The payment service is provided by Fufeitong (付费通), a third-party payment company controlled by Pinduoduo through affiliates. Fufeitong, established in 2003, has numerous 3rd party payment licenses, including internet payment and mobile payment. In the second quarter of 2020, the e-commerce platform had approximately 643.4 million monthly active users. Pinduoduo currently supports Alipay and Wechat Pay, which charges merchants for withdrawal or transfer. The new wallet Duoduo will support free withdrawal to bank cards to acquire new users.

Bairong Inc, which closed Round C financing of RMB1 billion in 2019, submitted its IPO prospectus to the HKEX on December 8th. Set up in 2014, the company has an AI-enabled platform and provides big data analytics services to financial institutions. Its products include smart marketing for client acquisition, loans issuance, insurance, client maintenance, and after-loan management.

On December 7th, the Shanghai Stock Exchange announced that VZoom CreditTech, a big data credit information and big data risk control service provider established in 2014, had passed initial discussions to float on the Shanghai Stock Exchange Science and Technology Innovation Board (STAR), China’s science and technology focused equities market. The company’s 2nd biggest shareholder is Ant Group, which recently failed its IPO. Moreover, Mybank, Ant Group’s internet banking arm, was VZoom’s largest client in 2019. To proceed further, the STAR listing committee now requires more information on how VZoom collects and uses credit data. Should it succeed, the company will become the 1st credit technology company to be listed on STAR.

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