Hello Fintech friends,

Welcome to the January edition of This Month in Fintech - China!

Lunar new year fell in January this year. After 3 years of tight pandemic controls, I was able to celebrate this new year with my family in my hometown (The Yellow Mountains). I included a photo of the mountains that I took during a hike.

Typically, the new year holiday will slow down businesses in China. Not this year though! A lot has happened from Jack Ma ceding control of Ant Group to tons of new product launches, it is quite an eventful month for Chinese fintechs.

Please enjoy :)

Yours,

Ning

News of the Month

• Jack Ma is giving up control of Ant Group, following a $1 billion fine as part of a restructuring ordered by the regulators. Ma previously held over 50% of voting rights, and his shares will now fall to 6.2%. It has sparked speculations around what’s next for Ant Group or China’s tech industry.
• The biggest question is around whether this could revive Ant’s IPO plan. At the moment, the company says it does not have any IPO plans. A common view on this is: Ma’s stepping down does not guarantee the success of Ant’s IPO, but serves as one of the prerequisites for it. Bloomberg wrote a comprehensive piece covering most of the IPO related topics on Ant.
• Around the same time when this happened, the government approved Ant’s consumer finance expansion plan, sending positive signals.
• Ant Group’s canceled IPO marked the beginning of the Chinese government’s crackdown on tech giants. Now with Ma giving up control of Ant Group, this 2-year long process has seemingly come to an end. Investors and entrepreneurs remain cautious in China’s fintech sector, despite the government vowing to support private companies.

Other News

• JPMorgan and Standard Chartered obtained Chinese regulatory approval to expand operations in China.
• PayPal China received regulatory approval to increase registered capital to enable further Chinese expansion.
• TikTok’s parent company ByteDance plans to launch payments with J.P.Morgan and it has raised concerns over national security.
• Crypto exchange Huobi plans to lay off about 20% of its staff.
• Airwallex plans to hire 500 people worldwide as tech giants make cuts.
• Hong Kong will propose a set of crypto tokens for retail trading.

Venture Financing

• China’s Alibaba Group sold its 3.1% stake in Paytm for $125M.
• Chinese auto insurtech firm Cheche to list on Nasdaq via SPAC.
• Hong Kong-based blockchain gaming developer Animoca Brands plans to double down investment during a crypto winter.
• Hong Kong's HashKey Capital closes third blockchain fund at $500M.

Product & Partnership Launches

• Airwallex has partnered with American Express to allow customers to accept Amex payments through payment links, Xero invoice payments and e-commerce shopping extensions.
• Binance launched a prepaid card in Brazil with Mastercard.
• Hong Kong-based money service operator Windsor First and Currencycloud collaborated to launch a new multi-currency account solution to help with Windsor First clients’ international payments.
• China Mobile, the parent company of Pakistan telecommunications network Zong 4G, launched its first digital payments solution ‘PayMax’.
• The People’s Bank of China (PBOC) has announced the launch of a new function on its digital yuan app, to allow Android NFC users to make offline digital payments.
• Hong Kong-based digital payment platform Yedpay expands to ASEAN through partnerships with Venture Cap, Easylink and Hong Kong Polytechnic University.
• Hong Kong challenger bank Livi Bank launched the first cross-border QR payment method for mainland consumers.

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