Ant Group thrown into disarray by China's new financial rules

Online microlender faces loss of its main revenue source after 2022

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New regulations put forth by China's financial authorities are designed to undermine the foundation of Ant Group's business model. © Reuters

YUSHO CHO, Nikkei staff writer

SHANGHAI -- China's financial industry watchdog has announced new regulations that will deal an additional blow to Ant Group and fundamentally upset the online microlender's business model.

Banks will be required to manage risks for joint lending with internet platforms, such as Ant, and "strictly banned" from outsourcing the function, the new regulation issued on Feb. 20 by the China Banking and Insurance Regulatory Commission stipulated in its first article.

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