China

This Month in Fintech - China (June 24’)

Image: 2024 Lujiazui Forum, a yearly event in Shanghai, China that brings together government officials, financial leaders, and scholars to discuss financial issues and make announcements about China's financial reforms. (Source: cna.com)

Hello fintech friends,

The fintech industry in China has seen a flurry of regulatory changes, financing activities, and product launches in the past June. Please take a read!

Chart of the Month: Chinese Banks’ Profitability Metric Hits Lowest Since 2010

Licensing & Regulations

Zhejiang Aerospace Electronics Information Industry Co. Ltd., a subsidiary of PingPong Payments, was fined 28.3 million yuan ($3.9 million) for multiple violations — the first penalty levied against nonbank payment providers since new rules on supervising such institutions took effect on May 1.
Chinese payment service provider Reapal acquired the Hong Kong Money Service Operator (MSO) License.
TikTok and its parent company, ByteDance have petitioned a U.S. court to invalidate the Tiktok Ban.
Tencent-backed WeBank received approval from the central government to set up a $150 million fintech subsidiary in Hong Kong.
Trading cryptocurrencies on exchanges without a local license remains possible in Hong Kong, according to Caixin.
China’s regulator has accepted Mizuho’s application to set up a securities firm.
China’s securities regulator will expedite the registration process for companies applying to list overseas.

Financing, Investment & Acquisition

Shein confidentially filed for an IPO in London.
Ant Group is likely to sell its stake in China’s first personal credit reporting company Baihang Credit to Tencent.
Bayview Acquisition, a SPAC, will merge with Chinese trade credit solutions provider Oabay in a $393 million deal.
Qatar’s sovereign wealth fund agreed to buy a 10% stake in China Asset Management Co., one of the nation’s largest mutual fund firms, for $490 million.
Transsion Holdings, a Chinese mobile phone and device-maker, is looking to expand investments in Pakistan’s mobile phones, electric bikes, agriculture, and fintech. Worth mentioning that Transsion Holdings is the biggest mobile phone seller in Africa and has been very actively investing in Africa’s startups including fintechs.
Hong Kong’s FundPark, has obtained a three-year US$250m private loan with HSBC Holdings as the senior facility provider.
Didi is reportedly meeting with US investors for a potential Hong Kong IPO in 2025; but the company said it has no timetable for a listing yet.
Allianz Global Investors (AGI), one of the investment arms of German insurer Allianz, has become the first foreign company to own a stake (2%) in China's pension insurance company Guomin Pension (国民养老保险公司) , with an investment totaling 284 million yuan ($39 million).
UBS has agreed to sell Credit Suisse's China joint venture to a state-owned Chinese firm after an offer from Citadel Securities fell short.

Product & Partnership Launches

PingPong Payments partnered with Kanmon to move into embedded lending.
Global HR Unicorn Deel launched a physical spend card powered by Airwallex.
HSBC China has rolled out digital yuan services for its retail and corporate customers.
Alipay+ expanded to Mongolia and the Philippines; and launched on DNA Payments’ POS in the UK.

Other News

China is negotiating with Visa, Mastercard to reduce transaction fees.
Ant Group lifted R&D spending to nearly $3bn on AI.
China's National Audit Office (NAO) found misrepresented loans by some state-owned banks including false claims of support in tech, green transition and agriculture sections. It also warned of new local government debt problems.
KPMG downgraded its expectations for 2024 Hong Kong’s initial public offering (IPO) market by 40%.
PwC faces client exodus over the Evergrande audit and has started mass layoffs.