Jack Ma's Ant Group gets approval to operate consumer finance firm
The Chinese government approved Ant Group's request for a licence to operate a new consumer finance company in which it will hold a 50% stake.
Ant will contribute 4bn Chinese yuan ($625.93m) in registered capital, the China Banking and Insurance Regulatory Commission said on Thursday.
Another six shareholders will contribute 4bn yuan and hold the remaining 50%.
The company will be registered in the southwestern city of Chongqing with a total registered capital of 8bn yuan, said CNBC.
The business will be able to give out personal loans and issue bonds among other things.
The consumer finance company will also house Ant’s credit businesses Huabei and Jiebei.
Late in 2020, Ant Group, was set to carry out a record-breaking $34.5bn IPO in Shanghai and Hong Kong. But Chinese authorities denied its approval over regulatory concerns.
The People’s Bank of China ordered Ant Group to come up with a rectification plan in December and approved a series of steps in April. One of those included Ant Group becoming a financial holding company.
A spokesperson for Ant Group said on Thursday: "Under the guidance of regulators, Ant will work with other shareholders of Chongqing Ant Consumer Finance Co. Ltd. to serve the needs of consumers, and to continue enhancing the quality of financial services and risk management capabilities."