China’s Fintech Crackdown Not Over Yet

The governor of the country’s central bank said it would be taking more steps to curb monopolistic behavior among internet platform companies and strengthen consumer privacy and data security.

We will continue to cooperate with anti-monopoly authorities to curb monopolies and actively deal with algorithm discrimination and other new forms of anti-competition behavior, Yi Gang, governor of the People’s Bank of China, said on Thursday.

Yi added that the country would be strengthening the regulation of the payments sector and require all financial services companies to be licensed, Yi said at a Bank for International Settlements conference.

According to the governor, financial businesses must be licensed to operate, firewalls must be set up between different parts of the business to prevent cross-sector risks, and the direct link between non-banks and banking information services must be cut.

China’s once-flourishing fintech industry has been hit by a wave of regulation. State authorities forced Jack Ma’s Ant Group to cancel its much-awaited initial public offering last fall, and peer-to-peer lending, once booming in in the country, is now virtually nonexistent.

The crackdown has also extended to the wider tech industry, with tightened restrictions in numerous areas such as payment links to financial products, collection of customer data, credit scoring services and overseas listings.

In recent months, authorities have also introduced new rules to regulate the online gaming, after-school classes, and entertainment sectors.