SINGAPORE/HONG KONG (Reuters) – China’s top antitrust bureau is considering whether to start a probe into Alipay and WeChat Pay, motivated by the fundamental bank which asserts the electronic payment giants have used their dominant positions to quash competition, sources with knowledge of the issue said.
FILE PHOTO: Evidence accepting WeChat Pay and AliPay are exhibited at a store in Singapore May 22, 2018. Picture taken May 22, 2018. REUTERS/Edgar Su
The State Council’s anti-trust committee was collecting information on Alipay, possessed by Ant Group that subsequently is an affiliate Alibaba Group Holding Ltd (BABA.N), in addition to on Tencent Holdings Ltd’s (0700.HK) WeChat Pay for at least a monththey stated.
Any evaluation would probably dampen enthusiasm for Ant Group’s planned dual listing in Hong Kong and Shanghai that’s looking for a valuation of over $200 billion.
The anti-monopoly committee has not made a determination regarding whether to proceed with an investigation, the sources said and it wasn’t apparent when a decision may be made. 1 source stated the committee is accepting the People’s Bank of China’s recommendation “very seriously”.
The sources, who declined to be recognized as the coverage deliberations were private, also stated that Ant and Tencent are lobbying government officials in a bid to protect against a probe.
The State Council Information Office and the fundamental bank didn’t respond to requests for comment. Ant and Tencent did not respond to requests for comment on the possible probe.
The People’s Bank of China officially made the recommentation the State Council committee ought to research anti-trust problems posed by the country’s non-bank payment businesses sometime in the next quarter, among those sources mentioned.
Alipay and WeChat Pay services, that empower payments in the ease of a code scan, are becoming ubiquitous in everyday life in China, with lots of individuals now infrequently utilizing cash.
The country’s mobile banking marketplace immobilized some 56.2 trillion yuan ($8 trillion) worth of trades in last 3 weeks of 2019, based on national consultancy Analysys. It quotes Alipay orders 55% of this current market and Tencent’s fintech company, the majority of which will be WeChat Pay, has 39%.
But governments have been eager to whittle their dominance back. In a bid to encourage smaller players to enter the current market, the fundamental bank last year said it intended to standardise the interoperability of QR signal obligations.
China’s legislative body can also be debating significant alterations to its antitrust legislation for the very first time in over 11 decades, which can be set to include enlarged criteria for estimating a company’s management of a marketplace.
(This story corrects paragraph 6 to reveal businesses didn’t respond to requests for comment)
Reporting by Keith Zhai at Singapore and also Julie Zhu at Hong Kong; Examining by Edwina Gibbs